reports
- Niklas Wetterling
Sveafastigheter (Buy, TP: SEK43.00) - 2025 could be year costs normali...
As expected, Q4 was hurt by one-off central admin costs. We believe a re-rating hinges on proof of normalised costs LTM (a 2024 NOI margin including property admin of 56.6%, versus the ‘earnings capacity’ guidance of 62%), which we expect in 2025–2026. We reiterate our BUY, but have cut our target price to SEK43 (45) on higher interest costs and updated peer valuations.
- Niklas Wetterling
Sveafastigheter (Buy, TP: SEK45.00) - Last quarter until costs normali...
We believe Q4 results will include one-off costs in relation to bringing in-house the final externally managed properties. We believe the market is looking for a track record for the company’s normalised cost base before a repricing could materialise – we expect this to happen in 2025–2026. We reiterate our BUY, while cutting our target price to SEK45 (47) due to an interest rate uptick.
- Niklas Wetterling
Sveafastigheter - Initiation of coverage - Two-in-one
We believe Sveafastigheter standalone could get back to creating value in its sizeable residential development business and reinvest earnings from its SEK24.5bn portfolio of rent-regulated apartments. In our view, the segment is nearing an inflection point, backed by non-cyclical demand and our expectation of above-CPI rent increases for several years. The stock is trading at a 54% discount to NAV (sector average: 23%), which looks attractive given its 43% LTV and renewed balance sheet. We initi...
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