Cityvarasto

In our view, the target is an excellent fit for the company's strategy, but due to its large size, good return figures will likely take longer than usual to materialize.

22:24

We initiate coverage with a target price of EUR 17.00 and a Buy-recommendation.

Cityvarasto is clearly the largest self-storage company in Finland, with a real estate business complemented by van rentals and moving services. At the core of its growth strategy is the cost-efficient acquisition of real estate nearing the end of its life cycle and gradually converting it into self-storage facilities with an EBITDA yield of around 15% on the investment. Indeed, revenue has grown by an average of about 20% per year over the past ten years, and we estimate that the company will be able to continue its strong profitable earnings growth, albeit at a significantly slower rate than targeted (adj. EBITDA 11% p.a. 2026-30) in the coming years as well. We consider the valuation highly attractive from many angles (EV/EBITDA 2027e: 10x), considering the company’s growth outlook, market position, and moderate risk level.