UBS on Friday moved St. James’s Place plc (LON:STJ) from a Neutral to a Buy recommendation, saying the share price now offers an appealing valuation despite new competitive and technological uncertainties tied to artificial intelligence in wealth management.
The broker set a revised price target of GBP14.65, down from GBP15.65 previously. UBS said the cut in its target reflects an updated valuation that incorporates potential downside from AI technologies being applied to financial planning and related services.
St. James’s Place stock has declined 13% year-to-date, a slide UBS links primarily to market reaction after the launch of an AI-enabled tax planning tool in the United States. To explicitly reflect those risks, UBS trimmed its price target by about 6%.
From a multiples perspective, UBS noted St. James’s Place is trading at 12.5 times fiscal year 2027 earnings, which the bank says makes it the least expensive valuation among UK asset gatherers. The stock’s current price-to-earnings ratio sits at 13.9 times. Technical indicators cited in the broker note show the relative strength index in oversold territory, which UBS flagged as a possible signal for investors looking to add exposure.
UBS also projects St. James’s Place could deliver earnings growth in excess of 20% over the medium term, and has singled it out as its top pick among UK asset gathering firms.
On distribution, the company has continued paying dividends for 29 consecutive years, according to InvestingPro, which additionally lists nine further ProTips for the stock. For U.S.-based investors, the shares are available to trade over-the-counter under the ticker STJPF.
Market reaction to AI developments has not been limited to St. James’s Place. UBS Group AG itself saw a 3.8% decline in its stock amid heightened concerns over how AI could disrupt traditional wealth management models. That move followed a wider selloff among U.S. wealth managers after startup Altruist introduced AI-enabled tax planning features, which intensified investor worries that advanced platforms may automate complex advisory tasks historically performed by human advisers at established firms.
Operationally, St. James’s Place reported a sharp fall in fourth-quarter net flows, which fell 63% year-over-year to £0.6 billion. Management and UBS treated that decline as expected, attributing it to pricing changes implemented in August and investor uncertainty tied to pension taxation measures announced in the November budget.
Despite the quarterly dip, the firm posted stronger full-year net flows, with a 42% increase to £6.2 billion for the year ending 2025. Investment performance also contributed to growth in assets under management, which rose 16% year-over-year to £220 billion - a level described as slightly above consensus expectations.
UBS’s upgrade underscores a valuation-driven investment case for St. James’s Place amid a backdrop of technology-driven disruption and mixed near-term flows. The bank’s move balances recognition of the company’s attractive multiples and dividend track record with explicit adjustments for the competitive implications of AI tools in wealth management.