Jefferies starts coverage of Rathbones at 'underperform', shares slide

(Sharecast News) - Rathbones slumped on Thursday as Jefferies initiated coverage of the shares with an 'underperform' rating and 1,650p price target. "This is a solid business, but higher growth and operational gearing are available elsewhere in the wealth sector, and we fear traditional discretionary fund managers will be squeezed by advice businesses, platforms and upmarket players," the bank said.

Jefferies said the dividend yield is quite attractive but it does not expect revenues or operating margins to expand much.

At 0910 GMT, the shares were down 4.4% at 1,823.60p.