SB1 Markets has adopted a positive outlook on the Swedish real estate sector, initiating coverage of 22 stocks, with 17 receiving buy recommendations and five rated as neutral. The analysis house projects an average upside of approximately 20 percent compared to their target prices.

SB1 Markets believes the sector should soon return to the spotlight following a weak performance in 2025. So far this year, the sector index, OMXS Stockholm Real Estate, has fallen by 12 percent, in contrast to the broader OMSXPI index, which is up 6 percent.

"Given the difference between the sector's EPS development (consensus) and share price performance during 2025, we see a clear opportunity for a recovery," the analysts state.

SB1 expects fundamental factors to improve through 2026, with several drivers becoming more favorable. The firm highlights: 1) stronger GDP growth in 2026; 2) credit markets offering good access to financing and a reduction in credit spreads on the capital market; and 3) an increase in property transactions.

Looking at different segments, SB1 Markets sees strong support for light industrial and logistics thanks to higher yields, while residential rentals should benefit from lower financing costs and continued strong annual indexing. Offices remain mixed, but the analysts believe the worst is over and expect central, modern portfolios to outperform the market. Hotels have exceeded expectations as demand remains robust and new supply is limited, although exposure here is mainly through Pandox and, to some extent, Balder.

Among larger companies, SB1 Markets' favorites are NP3, Pandox, and Sagax. Among smaller companies (with a market capitalization below SEK 10 billion), Emilshus, Logistea, and Stendörren are top picks.

All recommendations are detailed in the table below:

Stock Recommendation Target Price, SEK
Atrium LjungbergNeutral 35
BalderBuy 77
CastellumBuy 130
CatenaNeutral 470
CibusBuy 185
DiösBuy 90
EmilshusBuy 60
FabegeNeutral 87
HufvudstadenBuy 150
John MattsonNeutral 75
LogisteaBuy 20
NP3 Buy 300
NyfosaNeutral 79
PandoxBuy 225
PlatzerBuy 90
PrismaBuy 33
SagaxBuy 230
SLPBuy 50
StendörrenBuy 240
StenhusBuy 14
WallenstamBuy 50
WihlborgsBuy 110