Translation: Original published in Finnish on 8/5/2026 at 8:00 pm EEST.

We revise UB's target price to EUR 21.0 (was EUR 19.0) in line with our increased earnings estimates. At the same time, we lower our recommendation to Sell (was Reduce) as the share's valuation has detached from its fundamentals. 

Several changes to forecasts

The key changes are the inclusion of the Fondita acquisition in our forecasts, an increase in performance fees due to the excellent performance of UB Forest, and weaker-than-expected new sales in H1. In addition, we have postponed our estimate for real estate funds to return to growth, as the sector's situation remains dismal. Overall, our earnings estimates for the next few years have increased by 4-12%, and we expect strong earnings growth from the company in the coming years (2025-2029 EPS CAGR of ~15%).

H1 print shaping to be good, even though sales are sluggish

United Bankers will report its results on Thursday, August 20. We forecsat UB's H1 revenue to grow by 8% year-on-year to 31 MEUR. According to our calculations, recurring fees will increase by ~10% as a result of asset management and increased fund AUM. Performance fees are at an excellent level in H1 (8 MEUR), driven by the strong performance of UB Forest. Market volatility in the spring has likely also raised the volumes of structured products to a moderate level, but their significance on a group scale is small.

UB's new fund sales have been sluggish in the first half of the year, and net subscriptions for spearhead funds are slightly negative due to redemptions from real estate funds. New sales have also been sluggish in traditional funds, and the Group's new sales are largely dependent on asset management. We estimate that asset management sales have continued their excellent development. AUM will rise to 5.8 BEUR, driven especially by the acquisitions of Fondita and Fourton. We note that the acquisitions are only partially reflected in the revenue, as they were completed only towards the end of the period.

EBIT will grow by 11% year-on-year to 9.8 MEUR, in line with revenue. Profitability is at a good level of around 30%. UB is currently making front-loaded growth investments that are somewhat depressing profitability. The result is again highly dependent on performance fees, and profitability adjusted for performance fees is at a weak level.

Guidance upgrade is likely

UB has guided that its operating profit will be close to or grow from the 2025 level. With our updated forecasts, we now expect an EBIT of almost 20 MEUR, representing growth of ~20%. We consider it almost certain that UB will revise its guidance upwards in connection with the H1 report.

Regarding the outlook, we expect management's comments to remain quite positive. Our focus in the H1 report is on the company’s comments regarding its new sales. New sales are currently far from their full potential, and sales of spearhead funds in particular are unacceptably weak. Comments on new product launches are also of interest, and we would not be surprised if the company introduced a closed-end PE product in H2.

Stock valuation has risen to an unsustainable level

UB's share price has risen sharply in a short period, and the stock's valuation has become elevated. Based on 2026 earnings, the P/E ratio is ~20x, which is well above the company's historical levels and our acceptable levels for it. Also, in relation to its peers, the valuation has swung to a significant premium, which we find difficult to justify. We note that UB's earnings mix is still very modest, and performance fees account for a significant portion of earnings (2026 ~70%). Because performance fees come from individual products, the associated risk is high, which in turn would argue for lower valuation multiples. We consider the stock to be very expensive at the moment, and the current rally offers an excellent selling opportunity for investors.