Track market-moving stories before they get noisy

RBC Capital Markets has trimmed its price target for Rathbones Group PLC (LSE:RAT, OTC:RTBBF) to 1,950 pence from 2,400 pence, reflecting a surprise regulatory update that adds near-term uncertainty to the wealth manager's turnaround narrative.

The company disclosed on 16 June that it will cease charging investment management fees on client cash and pause onboarding of new enhanced due diligence clients for the next twelve months.

Existing EDD client inflows will also moderate. RBC's earnings per share forecasts have been downgraded 5% for 2026, 2% for 2027 and 6% for 2028, reflecting these headwinds.

The regulatory announcement arguably complicated Rathbones' investment case by injecting uncertainty around reviews into client outcomes and aspects of pricing.

It will likely delay the inflexion to positive organic growth, forcing the market to scrutinise net flows excluding EDD clients as evidence of underlying improvement. That pivot toward closer monitoring of non-EDD flows represents a tactical setback for the narrative around execution quality.

Yet RBC retained its 'outperform' rating, arguing the shares trade at fewer than 9 times 2027 estimated earnings, placing Rathbones among the cheapest wealth managers globally.

The bank highlighted a material valuation discount to peers, which trade at roughly 15 times earnings despite Rathbones delivering solid earnings growth of 5% annually through 2028.

RBC's thesis hinges on multi-year operational improvement under chief executive Jonathan Sorrell as the integration of the Investec Wealth business matures and delivers synergies.

The bank also flagged potential acquisition appeal, noting Rathbones' market positioning in UK wealth and the group's distressed valuation could attract buyers seeking scale in the domestic sector.

The dividend yield stands at 6.2%, with RBC forecasting a combined ordinary dividend and share buyback generating approximately 8% total yield in 2026.

RBC's upside scenario of 3,000 pence assumes the stock re-rates to 16.5 times 2026 earnings, which the ten-year peak multiple of 18 times suggests is not unreasonable. However, the regulatory update has plainly shifted sentiment in the near term, making near-term catalysts less obvious.

BSF Enterprise PLC (LSE:BSFA, OTC:BSFAF) said its T-Rex Leather handbag project had successfully validated the structural performance of its advanced tissue engineering platform, despite the Paris auction falling short of its reserve price.

The company said public bidding for the world’s first T-Rex Leather handbag reached €150,000 at Hôtel Drouot in Paris, missing the reserve of €500,000, and the piece has now been moved into a private sale process aimed at interested auction parties, institutional collectors, museums and high-net-worth individuals.

BSF described the project as a technical demonstration rather than a consumer fashion launch, saying the handbag proved its ability to produce a dense, stitchable and tannable bio-synthetic material using its scaffold-free ATEP platform.

The company added that the visibility from the Paris exhibition had accelerated commercial discussions with major potential partners, including a global sportswear business assessing performance footwear applications and a tier-one automotive manufacturer exploring sustainable vehicle upholstery.

Chief executive Dr Che Connon said the auction had demonstrated “an incredible engineering feat”, adding that automotive and footwear groups were not interested in buying a handbag but in licensing the platform that created it.

BSF also pointed to its broader portfolio, including lab-grown leather, 3D Bio-Tissues’ City-Mix and CytoBoost products, and Kerato’s corneal repair technology, saying its value remained supported by multiple commercial and clinical development routes.