How Improved Q3 Profitability at Fabege (OM:FABG) Has Changed Its Investment Story

• Fabege AB (publ) recently reported its third quarter and nine-month 2025 results, with net income rising to SEK99 million in Q3 and a sharp reduction in the nine-month net loss to SEK168 million compared to the prior year.
• This marked improvement in earnings highlights operational progress, especially as basic earnings per share increased substantially from SEK0.04 to SEK0.32 for the quarter.
• We’ll now examine how Fabege’s improved profitability in Q3 could influence the company’s long-term investment outlook and risk profile.

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Fabege Investment Narrative Recap

Fabege’s investment appeal rests on the belief that demand for prime Stockholm office space will eventually recover, supporting rental growth and asset values. The latest earnings show a marked improvement in profitability, but the core risk remains: persistent weakness in the Stockholm office market, including negative like-for-like rental growth and slow leasing, could pressure revenues short-term if tenant demand does not materialize. While the uptick in earnings is positive, it does not fundamentally alter this immediate challenge.

One recent announcement that stands out is Fabege’s new 7-year lease agreement with Ruff, covering 900 square meters in central Stockholm. This is relevant as it shows the company’s ongoing efforts to secure long-term cash flow and manage occupancy rates, a key short-term catalyst, especially given the ongoing softness in net lettings across the city.

However, investors should also weigh the ongoing risk that, despite such leasing wins, persistent vacancy and downward pressure on contract rates could…

Read the full narrative on Fabege (it's free!)

Fabege's narrative projects SEK 3.7 billion revenue and SEK 3.0 billion earnings by 2028. This requires 1.8% yearly revenue growth and an earnings increase of SEK 2.8 billion from current earnings of SEK 202.0 million.

Uncover how Fabege's forecasts yield a SEK84.91 fair value, in line with its current price.

Exploring Other Perspectives

Fair value estimates from two Simply Wall St Community members range from SEK0.07 to SEK84.91 per share, spanning nearly the entire current price band. While market views differ widely, persistent local market risk could affect rental income and asset values, be sure to consider several perspectives as you assess Fabege’s outlook.

Explore 2 other fair value estimates on Fabege - why the stock might be worth as much as SEK84.91!

Build Your Own Fabege Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Fabege research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Fabege research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Fabege's overall financial health at a glance.

No Opportunity In Fabege?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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