Nyfosa (Buy, TP: SEK91.00) - Q4 better than market’s reaction
We reiterate our BUY following the solid Q4 results and have increased our target price to SEK91 (87) after raising our 2024–2025e EPS by 2% on our higher JV earnings forecasts. Furthermore, we like the net lettings and improved vacancy rate in Q4. We still like Nyfosa ahead of the first rate cut given its high interest rate sensitivity and somewhat higher financial gearing than most peers – despite somewhat less upside potential than previously. The stock is trading at a 2024–2025e P/FFO of c15.2–13.6x, which we consider attractive.Nyfosa AB is a Sweden-based real estate investment company. The Company's transaction-based investment strategy is not limited by property category, region, scope of the transaction or holding period. The Company focuses on commercial real estate, with the property portfolio divided into three categories: Offices, Logistics/Warehouse and Other. The properties are diversified geographically, with the office buildings mainly located in Swedish municipalities and the warehouses in transportation hubs across Sweden. The Other category includes retail premises, hotels and industrial spaces. The portfolio comprises more than 170 properties with a total leaseable area of approximately 1,500,000 square meters. The Company develops and adds value to its property holdings through active approach to property management. All of electricity supplied to its properties derives from renewable sources.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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