The wealth management industry is experiencing a shift in registered investment advisor (RIA) valuations, with consolidators predicting a flatline in the latter half of 2026. This marks a notable change from 2025, when some expected higher valuations. DeVoe & Company's survey of 100 RIA executives reveals that 82% anticipate stable valuations, 18% expect declines, and none expect increases. This shift suggests a more measured approach to pricing, with buyers expanding their pipelines but becoming more cautious about valuations. The current buyer pool offers a wide range of valuation outcomes, with internal succession transactions at the lower end and strategic RIA acquirers paying more. PE-backed consolidators typically pay the highest valuations when sellers hire investment bankers. Brett Zaniewski, co-founder of Decerno Advisors, agrees that valuations may have peaked but emphasizes that they are not down. He notes that buyers are flexible on cash/equity mix and increasing earnouts to make deals more favorable for sellers. Larger RIAs remain a top target, with 46% of consolidators seeking firms between $1 billion and $5 billion in assets under management. However, there is an expectation gap between what buyers are willing to pay and what sellers expect. Nearly three-quarters of consolidators say the gap is widening, while just 9% believe it is narrowing. This disconnect stems from years of record transaction volume and headline-grabbing valuations that have shaped seller expectations. Despite a slowdown in the second quarter, RIA M&A activity remains historically strong, with the strongest first half of deals on record. M&A consultants at Marshberry predict a robust 2026 for dealmaking, forecasting over 400 deals in the wealth management sector. This shift in valuations and dealmaking activity highlights the evolving landscape of the wealth management industry, with buyers becoming more cautious and sellers adjusting their expectations.
