Consti - Stable quarter in sight
Consti reports Q4 results on February 6th, which we expected to be quite in line with previous year figures. Consti recently won a major contract, providing solid potential 2027 onwards, and following the share price rally we adjust our rating to ACCUMULATE (BUY) with a TP of EUR 12.5 (11.5).
Expect Q4 figures similar to previous year levels
Consti will report its Q4/2025 results on February 6th. We expect Q4 revenue to be EUR 92.7m and EBIT to be EUR 3.7m. FY25 EBIT guidance of EUR 9-12m implies EBIT of at least EUR 3.5m in Q4. Profitability has been on the softer side so far this year, partly due to weaker performance in the Service business, but we expect margins to recover to previous year levels through performance improvements. We expect a dividend proposal of EUR 0.70 per share (2024: 0.70). We anticipate 2026 guidance to correspond to the 2025 guidance, with the outlook for growth and margin improvement still modest.
Signed new very significant contract
Consti won a large multi-year contract that will considerably support growth in the Public sector business area and overall revenue growth over multiple years from 2027 onwards. The confirmed contract value is currently EUR 112m, with potential for a further ~EUR 60m, if the additional expansion project is implemented. The alliance type contract limits Consti’s risks and profit potential but through the significant contract value the profit potential is still notable for Consti. We model modest revenue growth of 2.8% for 2026 and we expect a 0.4%p EBIT margin improvement to 3.2%. We base our estimates on flat renovation construction market growth and improving profitability in the Services business. For example, The Finnish Real Estate Federation member survey for housing companies shows members expect same amount of investment in renovation projects for 2026 as in the previous year.
ACCUMULATE (BUY) with a TP of EUR 12.5 (11.5)
After the recent rise in the share price and announced large project, we downgrade our rating from BUY to ACCUMULATE and increase our target price from EUR 11.5 to EUR 12.5. 2026e P/E of ~12x is quite fair and looks more appealing on 2027e figures (~9x) when revenue and earnings growth should pick up. The investment case if further supported by continued attractive dividend yields (2025e: 6%).