NatWest stock faces UBS target cut as margin outlook stays flat

Published on 11/06/2026 at 12:32 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWS

NatWest stock faces a lower UBS target after management signaled broadly stable margins through 2027. UBS kept its Buy rating.

Margin outlook weighs on forecasts

UBS lowered its NatWest price target while maintaining a Buy rating.
Management expects net interest margins to remain broadly stable through 2027.
Capital relief could offset part of the pressure on earnings expectations.

NatWest, GB00BM8PJY71, Illustration mit AI erstellt.

UBS lowered its price target for NatWest Group to 775 pence from 835 pence, while retaining a Buy rating. The change followed management's signal that net interest margins are likely to remain broadly stable through 2027. The assessment was reported by Proactive via Yahoo Finance on November 3 and was updated on November 6.

UBS sees weaker earnings momentum

NatWest reported a third-quarter net interest margin of 2.50%, according to the report. That was one basis point higher than in the previous quarter and 15 basis points above the year-earlier level, excluding one-off adjustments.

UBS said the stable-margin outlook was less favorable than market expectations for an expansion of more than 10 basis points. The broker estimated that the outlook could leave NatWest's 2027 pretax profit 4% to 5% below consensus. It also reduced its adjusted earnings-per-share forecasts by 2% for 2026 and by 3% for both 2027 and 2028.

Capital remains a counterweight

The broker also highlighted a potential improvement in NatWest's capital position. It expects risk-weighted assets of about GBP 210 billion from January 2027, below a GBP 214 billion consensus estimate, and cited a planned 43-basis-point reduction in the Pillar 2 capital requirement. UBS said that change could release about GBP 1 billion of additional capital headroom.

For investors, the report sets a more cautious earnings frame against NatWest's capital-generation and valuation arguments. UBS expects competitive pressure from Lloyds Banking Group and HSBC to keep attention on the outlook for UK retail banks, while it sees an expected dividend yield of about 6% as support for its positive stance.

The real-time quote of NatWest stock traded at 7.00 euros on Lang & Schwarz at 12:30 CET on Friday, November 6, 2026.