Alexandria Group

Sales were strong in both equities and fixed income, and sales were also broadly distributed among operators.

For asset managers on Nasdaq Helsinki, the trend has been mixed. The market situation has been very challenging for operators focusing on alternative investments, particularly real estate, while traditional asset management has continued to grow strongly.

For financial companies, 2025 has been very positive in terms of the operating environment, with strong capital market development and stabilized interest rates. However, the performance of the companies has been varying, and many companies we follow have suffered particularly from the subdued development of alternative investment returns (new sales and performance fees).

According to the Fund Report published by Finnish Investment Research, net subscriptions to Finnish investment funds in November amounted to almost one billion euros.

Asset managers' results declined sharply during the first half of the year. However, underlying factors include challenges in the real estate market and a decline in performance fees, and the operational development shown below has been largely positive. The outlook for the sector is positive, and as long as geopolitical risks remain in the background, companies in the sector are poised for robust earnings growth in the second half of the year.

The early part of the year has been moderate for asset management companies. Although stock prices are near their all-time highs in many places and interest rates have been in clear decline, market sentiment has been cautious, especially due to geopolitical tensions. Companies in the sector describe the early-year sentiment as mostly expectant. At the same time, however, the general tone of the comments has been cautiously positive.

We revise our target price for Alexandria to EUR 10.5 (was 10.0) on the back of our raised earnings estimates, and upgrade our recommendation to Accumulate (was Reduce). The company's strategy has progressed in the right direction and we believe that for the first time in its history, the company has credible building blocks for success in asset management. Even with our cautious estimates, the stock looks cheap, and the sector's highest dividend yield provides a backbone for the current valuation.

Real estate has been one of the best performing asset classes in asset management over the past decade. This has been true for both investors and the companies that manage their investments.