On Tuesday, Nomura Real Estate Holdings, Inc. (3231:JP) (OTC: NMEHF) saw its price target increased by Citi to ¥4,800, up from the previous ¥4,300, while the Buy rating on the stock was reaffirmed. The adjustment follows a revision of forecasts by the analyst, citing a robust condominium market as the primary driver for the raised target.
The analyst highlighted the strong performance of the condo market, which has led to an increase in the target EV/EBITDA multiple to 13.5 times, up from 12.5 times. This optimistic outlook is supported by the solid contract rate of approximately 70% at Blue Front Shibaura, a residential project by Nomura Real Estate.
Nomura Real Estate's prospects also appear favorable due to the anticipation of a recovery in overseas earnings. The analyst expects that the company's international profits are poised to stabilize after a period of decline.
The report also suggests that Nomura Real Estate could potentially enhance shareholder returns in the upcoming Mid-Term Plan (MTP), which is set to commence in the fiscal year starting March 2026. This expectation is based on the observed shareholder returns among competitors in the industry.
In summary, the firm maintains a bullish stance on Nomura Real Estate Holdings, Inc., expecting steady profits and suggesting the possibility of enhanced returns in the near future.
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