Ashmore Group plc (LSE:ASHM) shares fell around 3% on Monday after Deutsche Bank downgraded the emerging markets asset manager to Sell from Hold, citing concerns over future net inflows and elevated valuation levels.

Deutsche Bank analysts expressed doubts about consensus expectations for a sustained recovery in net inflows, given the current market environment and outlook for emerging markets. The bank now projects net outflows of $0.5 billion for fiscal year 2026 — equivalent to 1% of opening assets under management (AuM) — compared with consensus forecasts of $0.8 billion in net inflows (2%). The divergence widens for fiscal 2027, where Deutsche Bank anticipates continued outflows of $0.5 billion, while consensus estimates assume $3.0 billion in inflows (6%).

Valuation concerns were another key factor behind the downgrade. Analysts noted that Ashmore trades at a price-to-management fee earnings ratio of 21x for FY2027 based on Deutsche Bank’s estimates (or 20x on a headline P/E basis), versus sector peers trading around 10–12x. Even under the most optimistic consensus scenario — assuming $4.8 billion in net inflows (9% of opening AuM) — the stock would still trade at 18x price-to-management fee earnings or 16x headline P/E, levels viewed as unjustifiably high relative to the broader asset management sector.

Deutsche Bank concluded that the shares currently trade at a “material and unjustified premium” to traditional asset management peers, reflecting limited upside potential in the near term.

More about Ashmore Group plc

Ashmore Group plc is a London-based emerging markets-focused investment manager, offering strategies across fixed income, equities, alternatives, and multi-asset classes. Listed on the London Stock Exchange and a member of the FTSE 250, Ashmore manages global portfolios emphasizing emerging market debt and equities, serving institutional and retail clients worldwide.

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