* Earnings capacity IFPM p.s. +3% q-o-q
* Capital allocation to SBBs to continue
* 2026e P/CEPS 10x vs. coverage average of 14x
Ahead of expectations on lower costs
Stenhus' Q2 results showed rental income in line with our estimate and 1% below Infront consensus, while the NOI margin increased by 3pp y-o-y, resulting in NOI 2% ahead of our forecast and 1% ahead of consensus. We note, however, that there was only a marginal improvement in q-o-q earnings capacity, suggesting this should not be extrapolated. Central admin costs were slightly lower while net financials was slightly higher than both ABGSCe and consensus; together, this saw rec. PTP come in 2% ahead of ABGSCe and 1% ahead of cons. We make positive estimate revisions of 3-7%, driven primarily by lower assumed interest rates in our outlook than in Q1.
Forward-looking EC IFPM per share up ~3% q-o-q
Net letting amounted to SEK ~2m and occupancy rose by 0.1pp q-o-q to 94.7%. The forward-looking earnings capacity (EC) notes a 1% decrease vs. the current EC, where move-outs are expected to come into effect in H2'26e. Despite this, the forward-looking EC IFPM per share is up ~3% q-o-q, mainly driven by lower net financials and SBBs during Q2. Management notes increased activity in lettings, with previous renegotiations being neutral to slightly positive. Our impression from speaking with management is that they intend to continue with SBBs; with the share trading at a ~30% discount to reported EPRA NRV, this is clearly accretive. On announced transactions we estimate that net LTV will decline by ~1pp to 55%, but management indicated that they are willing push leverage closer to 60%.
2026e P/CEPS 10x vs sector at 14x
The share is trading at a '26e P/CEPS of 10x vs. the sector average of 14x, and a P/EPRA NRV of 0.6x compared to the sector average of 0.8x. We forecast average CEPS growth of ~10% in '26e-'28e vs. the average in our coverage of ~5%, with potential to drive earnings further.