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1. Company Snapshot

1.a. Company Description

YIT Oyj provides construction services for industrial and public sectors, and residential customers primarily in Finland, Sweden, Norway, Russia, the Czech Republic, Slovakia, Poland, Baltic countries, and internationally.The company operates through five segments: Housing Finland and CEE, Housing Russia, Business Premises, Infrastructure, and Partnership Properties.It develops and builds apartments and residential areas, as well as provides real estate property management, maintenance, and living services; develops wind power plants; and constructs office, commercial, business, logistics and industrial, and public buildings, such as hospitals, schools, and multi-purpose buildings.


The company also undertakes pipe renovation works for housing companies; builds roads, bridges, railway and metro stations, and ports and parking facilities, as well as energy, water supply, and industrial plants; maintains roads, streets, and green areas; and offers tunnel quarrying, mining, and reinforcement services.In addition, it provides property development services.The company was founded in 1912 and is headquartered in Helsinki, Finland.

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1.b. Last Insights on YIT

YIT Oyj's recent performance was driven by strong insider ownership, with a significant stake held by management, indicating confidence in the company's future prospects. This aligns management's interests with those of shareholders, making it an attractive consideration for investors. Additionally, the company's growth prospects in the European market, where trade relations have improved, are particularly appealing. Furthermore, the recent mixed market conditions have led investors to focus on growth opportunities, and YIT Oyj's robust growth prospects make it an attractive option.

1.c. Company Highlights

2. YIT's Q3 2025 Earnings: A Solid Performance with Room for Improvement

YIT reported a revenue decline to EUR 402 million in Q3 2025, primarily due to low apartment completions in the residential business, which in turn impacted the adjusted operating profit at EUR 12 million. The earnings per share (EPS) came in at -0.04, missing estimates of 0.035. Despite the decline in revenue, the contracting segment's profitability continued to improve, with the Infra segment's adjusted operating profits reaching almost 6% and the Building Construction segment's at 4.5%.

Publication Date: Nov -30

📋 Highlights
  • Revenue Decline and Profit Impact:: Revenue dropped to EUR 402 million due to low apartment completions, but adjusted operating profit stabilized at EUR 12 million.
  • Infra Segment Growth:: Infra revenue surged 30% to EUR 127 million, with adjusted operating margins reaching 6% and 4.5% in Infra and Building segments, respectively.
  • CEE Residential Expansion:: CEE residential volume grew 60% YoY, becoming a key profit driver with sales speed and project execution accelerating.
  • Capital Optimization Strategy:: Potential to unlock EUR 500 million from apartment inventory and non-core assets to fund growth and reduce net debt (EUR 669 million as of Q3).
  • Operational Efficiency Gains:: Residential Finland reduced lead times by 60%, enhancing customer feedback and NPS, while maintaining a strong EUR 40–60 million adjusted EBIT guidance for 2025.

Segment Performance

The residential segment in CEE was a standout, with a 60% volume growth compared to the rolling 12 months figures. The segment's revenue and profits were heavily tilted towards Q4, driven by increasing sales speed. The Infra operations also had a solid performance, with top-line and profitability growth, and a steady order book. As Heikki Vuorenmaa, CEO, highlighted, the team's efforts in managing new projects and favorable market conditions reinforced the segment's role as a key driver for growth.

Financial Position and Guidance

YIT's return on capital employed was at 3%, and gearing was at 85%. The net debt decreased to EUR 669 million. The company revised its guidance, expecting the adjusted operating profit for the year to be between EUR 40 million to EUR 60 million. The company also identified potential to release up to EUR 500 million of capital from its current apartment inventory and through divestments of non-core assets, which will be reallocated to fund residential segment's profitable growth and reduce indebtedness.

Valuation and Outlook

With a P/E Ratio of -11.76 and an EV/EBITDA of 43.63, the market is pricing in significant growth expectations. Analysts estimate next year's revenue growth at 8.9%. Given the current financial position and strategic priorities, YIT is well-positioned for targeted profitable growth. The company's plot portfolio remains strong, enabling new residential projects and supporting profitable growth. The release of capital and allocation to profitable businesses is a strategic priority, and the current financial position serves as a basis for this growth strategy.

Management Changes and Strategy

The company announced a change in leadership, with Tuomas Mäkipeska leaving as CFO and Markus Pietikainen joining as interim CFO. Heikki Vuorenmaa highlighted the strategic focus on elevating customer and employee experience, with customer feedback and NPS remaining high. The company's strategy is focused on profitable growth, and the recent wins in the data center market have strengthened YIT's position as a leading data center builder in Finland.

3. NewsRoom

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Assystem And 2 More European Companies Estimated To Be Priced Below Their Intrinsic Value

Dec -03

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European Stocks That May Be Trading Below Their Estimated Value

Nov -27

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3 European Stocks That Could Be Undervalued By Up To 37.7%

Nov -27

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3 European Stocks That May Be Priced Below Their Estimated Value

Nov -26

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3 Global Stocks That May Be Trading At A Discount Of Up To 47.5%

Nov -26

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3 European Stocks That May Be Undervalued By Up To 46.9%

Nov -26

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3 European Stocks Possibly Trading Below Their Intrinsic Value By Up To 39.9%

Nov -25

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3 Global Stocks Estimated To Be Undervalued By Up To 40.2%

Nov -25

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.57%)

6. Segments

Housing

Expected Growth: 4.5%

YIT Oyj's 4.5% growth in Housing is driven by increasing demand for affordable housing in Finland and the CEE region, supported by government incentives and subsidies. Additionally, YIT's focus on sustainable and energy-efficient construction, as well as its strategic partnerships and land banking strategy, contribute to its growth momentum.

Business Premises

Expected Growth: 4.2%

YIT Oyj's Business Premises segment growth of 4.2% is driven by increasing demand for modern and sustainable office spaces, particularly in urban areas. Additionally, the company's focus on energy-efficient solutions and digitalization of construction processes has improved operational efficiency, leading to higher margins and revenue growth.

Infrastructure

Expected Growth: 5.5%

YIT Oyj's infrastructure segment growth of 5.5% is driven by increasing demand for urbanization and transportation projects, government investments in public infrastructure, and growing need for sustainable and energy-efficient solutions. Additionally, the company's strategic focus on digitalization, innovation, and partnerships contributes to its growth momentum.

Other Items

Expected Growth: 3.8%

YIT Oyj's 3.8% growth is driven by increasing demand for sustainable urban development, strategic partnerships, and expansion into growing markets. Additionally, the company's focus on digitalization, operational efficiency, and cost savings initiatives contribute to its growth momentum.

7. Detailed Products

Housing

YIT Oyj provides a wide range of housing solutions, from apartments to single-family homes, catering to different customer needs and preferences.

Business Premises

YIT Oyj offers a variety of business premises, including offices, retail spaces, and logistics centers, designed to meet the needs of businesses of all sizes.

Infrastructure Construction

YIT Oyj provides infrastructure construction services, including road construction, bridge building, and other civil engineering projects.

Renovation

YIT Oyj offers renovation services for buildings and properties, including energy-efficient solutions and modernization projects.

Property Development

YIT Oyj develops and manages properties, including commercial and residential projects, from concept to completion.

8. YIT Oyj's Porter Forces

Forces Ranking

Threat Of Substitutes

YIT Oyj operates in the construction industry, where substitutes are limited. However, the company faces competition from other construction companies, which can be considered as substitutes.

Bargaining Power Of Customers

YIT Oyj's customers have limited bargaining power due to the company's strong market position and the lack of alternative suppliers.

Bargaining Power Of Suppliers

YIT Oyj's suppliers have moderate bargaining power due to the company's dependence on them for raw materials and services.

Threat Of New Entrants

The construction industry has high barriers to entry, making it difficult for new entrants to compete with established companies like YIT Oyj.

Intensity Of Rivalry

The construction industry is highly competitive, with many companies competing for market share. YIT Oyj faces intense rivalry from other construction companies.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.46%
Debt Cost 9.19%
Equity Weight 46.54%
Equity Cost 9.49%
WACC 9.33%
Leverage 114.88%

11. Quality Control: YIT Oyj passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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OHL

A-Score: 4.6/10

Value: 9.1

Growth: 4.0

Quality: 3.8

Yield: 0.0

Momentum: 9.5

Volatility: 1.3

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Técnicas Reunidas

A-Score: 4.5/10

Value: 5.9

Growth: 4.2

Quality: 4.6

Yield: 0.0

Momentum: 9.5

Volatility: 3.0

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Instalco

A-Score: 4.5/10

Value: 6.7

Growth: 7.4

Quality: 6.2

Yield: 4.4

Momentum: 1.0

Volatility: 1.3

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ABO Wind

A-Score: 4.3/10

Value: 7.2

Growth: 7.9

Quality: 4.6

Yield: 2.5

Momentum: 1.0

Volatility: 2.7

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Polimex-Mostostal

A-Score: 4.3/10

Value: 8.3

Growth: 4.1

Quality: 2.6

Yield: 0.0

Momentum: 10.0

Volatility: 0.7

1-Year Total Return ->

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YIT

A-Score: 3.9/10

Value: 6.7

Growth: 0.6

Quality: 2.5

Yield: 3.8

Momentum: 7.0

Volatility: 3.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

3.09$

Current Price

3.09$

Potential

-0.00%

Expected Cash-Flows