Expanding South, Compressing Returns

Research evidence excerpt

Expanding South, Compressing Returns

Sweden | Property & Real Estate

NP3 Fastigheter AB EquityJulyResearch16, 2026

TARGET | ESTIMATE CHANGEExpanding South, Compressing Returns

Stronger operating trends and an expanded investment pipeline drive our higher RATING UNDERPERFORM

forecasts and PT. That said, we see a less attractive risk-reward profile as PRICE SEK269.50^

NP3 expands into lower-yielding southern markets while continuing to rely on PRICE TARGET | % TO PT SEK200.00 (SEK183.00)

preference shares, diluting ordinary shareholders. We expect TR to converge | -26%

52W HIGH-LOW SEK293.00 - SEK224.00

towards sector levels despite significantly higher economic leverage, making

FLOAT (%) | ADV MM (USD) 43.9% | 11.67

the current valuation premium difficult to justify.

MARKET CAP SEK16.6B | $1.7B

Heading south for growth, but at lower returns. YTD, NP3 secured SEK1.9bn of acquisitions (6.5% TICKER NP3 SS

^Prior trading day's closing price unless otherwise

yield), primarily in Skaraborg and Trestad, marking its southernmost expansion ever. As expected, noted.

the limited depth of the Norrland market is pushing the company further south. In this context,

management raised its acquisition target to SEK2.5–3.0bn by year-end (from SEK2.0bn) and project

capex to SEK1.0bn annually (from SEK800m). That said, while acquisitions remain accretive relative FY (Dec) CHANGE TO JEFe JEF vs CONS

to the 3.9% CoD, acquisition yields have already compressed by 50–100bp versus historical levels. 2026 2027 2026 2027

REV +3% +6% NA NA

Aggressive balance sheet persists. Reported LTV stands at 52.5%, remaining within EPS +3% +4% NA NA

management’s 50–55% comfort range. However, this already represents a highly leveraged balance