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Earnings Rebound Might Change The Case For Investing In Fabege Stock (OM:FABG)

Simply Wall St · 2d ago
  • Fabege AB reported third quarter 2026 revenue of SEK 1,285 million and net income of SEK 700 million, with basic earnings per share from continuing operations at SEK 2.23.
  • Over the first nine months of 2026, Fabege moved from a loss in the prior year period to SEK 1,212 million in profit, signalling a sharp turnaround in reported profitability.
  • We will now look at how Fabege's sharp swing back to profit could reshape the investment narrative around its Stockholm office portfolio.

Scan how Fabege's sharp earnings rebound compares with other property stocks by reviewing the hand picked list of solid balance sheet and fundamentals (203 results) in similar real estate focused sectors.

Fabege Investment Narrative Recap

To own Fabege you need to believe its concentrated Stockholm portfolio can steadily absorb space at acceptable rents while refinancing risk stays manageable. The sharp move back into profit in the first nine months of 2026 supports that view, since SEK 1,212 million of net income gives the business more room to handle vacancies and debt costs.

In the short term, the key swing factor is still letting activity in a weak local office market. The biggest risk remains pressure on rental levels and valuations feeding through to like-for-like income and interest coverage. The latest earnings do not remove that exposure, but they ease the immediate pressure.

The most relevant update is the third quarter 2026 report itself. Revenue of SEK 1,285 million and quarterly net income of SEK 700 million show a very different picture to the prior year, and basic earnings per share of SEK 2.23 from continuing operations indicate much stronger reported profitability in the period.

For the nine months, Fabege moved from a SEK 168 million loss to a SEK 1,212 million profit, with basic earnings per share of SEK 3.85. That kind of swing, even with one-off items in the background, feeds directly into the main catalysts investors are watching, from funding flexibility to the capacity to keep investing in its Stockholm projects.

Fabege's current analyst narrative points to SEK 3.7 billion in revenue and SEK 2.3 billion in earnings by 2029, based on assumptions that annual revenue will decline by 2.5% while profit margins rise. This implies earnings would need to increase by about SEK 1.9 billion from SEK 431.0 million today to reach the consensus target.

Uncover how Fabege's fair value indicates a 15% potential upside to its current price, which could narrow quickly as sentiment catches up.

OM:FABG 1-Year Stock Price Chart
OM:FABG 1-Year Stock Price Chart

Exploring Other Perspectives

You have a very different picture if you focus on the key bearish catalyst: vacancy risk in Solna and other weaker assets. The lowest analysts were previously working off revenue shrinking about 6.6% a year and earnings only reaching around SEK 1.1b by 2029. Their narrative is clearly more cautious. The fresh Fabege earnings print may push some of those views to shift, so it is worth comparing several forecasts rather than anchoring on a single story.

Explore 2 other Fabege fair value estimates, including one that suggests as much as 57% downside from the current price.

Form Your Own Verdict

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

Looking for more investment ideas beyond Fabege?

If this Fabege update has sharpened your view on offices and funding risk, it can be useful to compare that thinking with a wider watchlist of companies with different balance sheet profiles and income characteristics.