The wealth management industry is experiencing a shift in registered investment advisor (RIA) valuations, according to a recent survey by DeVoe & Company. The survey, which surveyed over 100 RIA executives, predicts that valuations will flatline in the second half of 2026, marking a significant change from the previous year when 8% of consolidators expected higher valuations. This shift is attributed to a more measured approach to pricing, with buyers becoming more cautious after four years of record-high valuations.
The survey highlights a disconnect between what buyers are willing to pay and what sellers expect. Nearly three-quarters of consolidators report an expectation gap, with sellers demanding higher multiples, especially those with exceptional growth, profitability, and leadership teams. This disconnect is partly due to years of record transaction volume and headline-grabbing valuations, which have shaped seller expectations, particularly the premium multiples private equity pays for RIAs.
Despite the predicted flatlining of valuations, the M&A activity in the RIA space remains robust. The first half of 2026 saw the strongest M&A deals in the RIA space on record, with 167 transactions, 13% higher than 2025. However, the second quarter activity tapered to 74 transactions, just one more than the same period in 2025. This slowdown is attributed to buyers still having capital to deploy and sellers facing the same growth and succession challenges.
The survey also reveals that larger RIAs will remain a top target amid the deal frenzy, with 46% of consolidators seeking firms between $1 billion and $5 billion in assets under management. This shift upmarket is underscored by the fact that no respondents identified firms with less than $500 million in AUM as their primary acquisition target.
In conclusion, the wealth management industry is experiencing a shift in RIA valuations, with buyers becoming more cautious and measured in their approach to pricing. Despite the predicted flatlining of valuations, M&A activity remains robust, with larger RIAs remaining a top target. The industry is expected to continue to see historically strong transaction activity, with the potential for over 400 deals in 2026.
