Last Update22 Oct 25
Wihlborgs Fastigheter's analyst price target has been revised downward from SEK 120 to SEK 105. Analysts cite valuation concerns and reduced estimates for the change.
Analyst Commentary
Following the revised price target and downgrade, analysts have shared both optimistic and cautious views regarding Wihlborgs Fastigheter’s prospects. These insights shed light on the main factors influencing the new evaluation.
Bullish Takeaways- Bullish analysts highlight the company’s established market presence, which is seen as a foundation that supports near-term stability.
- The quality and diversity of the property portfolio are considered strengths and help to offset some market challenges.
- Strong tenant relationships and high occupancy rates are seen by analysts as factors that may cushion performance even in slower economic periods.
- Bearish analysts assert that current valuation levels appear stretched in relation to revised earnings expectations.
- Lowered growth estimates reflect concerns about potential headwinds in the commercial real estate sector.
- Some analysts warn that the firm’s execution risks may increase if market conditions deteriorate further.
- There is caution regarding the company’s ability to deliver on previous growth targets in a more challenging macroeconomic environment.
What's in the News
- Wihlborgs acquired the industrial property Snarskogen 2 in Vala Norra, strengthening its presence in the area with a new ten-year lease. The company also sold Planteringen 1:8 and 1:9 to focus on other developments. (Key Developments)
- NP Innovation will relocate its headquarters and expand production operations to Wihlborgs’ premises in Fosie, Malmö. The company will occupy 3,700 square metres under a five-year lease starting in December 2025. (Key Developments)
- A new restaurant concept, Bankpalatset, led by Simon Weinberg, is set to open in spring 2026 in Helsingborg’s historic Svea 7 building. This addition will bring multiple culinary experiences to the landmark property. (Key Developments)
- Wihlborgs Fastigheter will hold a Special/Extraordinary Shareholders Meeting on April 22, 2026. (Key Developments)
Valuation Changes
- The Fair Value estimate remains unchanged at SEK 110.4, reflecting no adjustment from previous projections.
- The Discount Rate has decreased slightly from 9.73% to 9.47%.
- Revenue Growth projections have stayed essentially stable, moving only marginally from 6.16% to 6.16%.
- The Net Profit Margin forecast is also steady, showing a small increase from 45.45% to 45.45%.
- The future P/E ratio expectation has declined modestly from 19.32x to 19.18x.
Key Takeaways
- Record high leasing volumes and improved occupancy rates indicate potential for increased revenue and enhanced profit margins.
- Strategic acquisitions and project investments are expected to positively impact earnings and asset valuations, supporting company expansion.
- High leverage and exposure to currency risk combined with increased vacancy rates could impact earnings, financial flexibility, and revenue stability in fluctuating market conditions.
Catalysts
About Wihlborgs Fastigheter- A property company, owns, develops, rents, and manages commercial properties in the Öresund region, Sweden.
- Record high volume of new leases in 2024 and continued strong leasing activity in 2025 indicates potential for increased rental income, especially as new leases come into effect and contribute to revenue growth.
- Ongoing project investments with successful outcomes suggest future enhancements in rental value and operating surplus, which can boost earnings and profit margins.
- The acquisition of property from Granitor is expected to contribute positively to financial results in future quarters, potentially impacting both revenue and asset valuations.
- Improved occupancy rates anticipated by the end of 2025, with the largest effect from new leases expected in 2026, could lead to higher revenue and better net margins due to economies of scale.
- Good cash flow generation and high running yield suggest a strong foundation for further expansion, which could drive up earnings and increase the company's valuation.
Wihlborgs Fastigheter Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming Wihlborgs Fastigheter's revenue will grow by 6.3% annually over the next 3 years.
- Analysts assume that profit margins will shrink from 44.4% today to 42.1% in 3 years time.
- Analysts expect earnings to reach SEK 2.2 billion (and earnings per share of SEK 7.32) by about September 2028, up from SEK 1.9 billion today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting SEK3.0 billion in earnings, and the most bearish expecting SEK1.7 billion.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 21.0x on those 2028 earnings, up from 14.8x today. This future PE is greater than the current PE for the GB Real Estate industry at 16.7x.
- Analysts expect the number of shares outstanding to remain consistent over the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 9.48%, as per the Simply Wall St company report.
Wihlborgs Fastigheter Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- The increased vacancy rates in certain areas, such as offices in Helsingborg and the industrial portfolio, could affect future rental income and occupancy rates, leading to potential decreases in net margins.
- The company’s net debt to EBITDA ratio of 10x and an LTV ratio of 49.5% suggests high leverage, potentially impacting earnings and financial flexibility, especially if interest rates rise or economic conditions worsen.
- Exposure to currency risk, as evidenced by currency translation impacts on property valuations, could negatively affect revenue and profit margins, especially given the differences between the Swedish krona and Danish krone.
- Potential delays or gaps between lease terminations and new tenant move-ins, as well as market conditions with fewer new projects, may lead to temporary reductions in rental income and affect revenue stability.
- Dependence on key sectors such as government tenants, which make up significant portions of rental income, creates sector concentration risk that could impact future cash flows and net margins if any adverse changes occur in these sectors.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of SEK112.4 for Wihlborgs Fastigheter based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of SEK120.0, and the most bearish reporting a price target of just SEK100.0.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be SEK5.1 billion, earnings will come to SEK2.2 billion, and it would be trading on a PE ratio of 21.0x, assuming you use a discount rate of 9.5%.
- Given the current share price of SEK90.75, the analyst price target of SEK112.4 is 19.3% higher.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
How well do narratives help inform your perspective?
Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Read more narratives
There are no other narratives for this company.
View all narratives