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Stock Analysis & ValuationSF Urban Properties AG (SFPN.SW)

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CHF104.50
Sector Valuation Confidence Level
Low
Valuation methodValue, CHFUpside, %
Artificial intelligence (AI)385.90269
Intrinsic value (DCF)61.12-42
Graham-Dodd Method124.7919
Graham Formula39.65-62

Strategic Investment Analysis

Company Overview

SF Urban Properties AG (SFPN.SW) is a Swiss real estate company specializing in the development, acquisition, and management of commercial, residential, and development properties. Headquartered in Zurich, the company focuses on building a diversified real estate portfolio in Switzerland, leveraging its expertise in property investment and urban development. Formerly known as Swiss Finance & Property Investment AG, the company rebranded in 2019 to reflect its strategic shift toward urban real estate opportunities. Operating in the competitive Swiss real estate market, SF Urban Properties AG emphasizes value creation through active asset management and sustainable development. With a market capitalization of approximately CHF 322 million, the company plays a significant role in Switzerland's real estate sector, catering to both commercial tenants and residential buyers. Its disciplined investment approach and local market knowledge position it as a key player in Swiss urban property development.

Investment Summary

SF Urban Properties AG presents a moderate investment opportunity with stable revenue streams from its diversified real estate portfolio. The company reported CHF 51.3 million in revenue and CHF 15.97 million in net income for the latest fiscal period, with a diluted EPS of CHF 4.76. Its low beta (0.258) suggests lower volatility compared to the broader market, making it a defensive play in real estate. However, the company carries significant debt (CHF 406.8 million), which could pose risks in a rising interest rate environment. The dividend yield, supported by a CHF 3.65 per share payout, may appeal to income-focused investors. While its focus on Swiss urban properties provides stability, limited geographic diversification could constrain growth. Investors should weigh its solid cash flow (CHF 24.24 million operating cash flow) against its high leverage.

Competitive Analysis

SF Urban Properties AG competes in Switzerland's tightly regulated and highly competitive real estate market. Its competitive advantage lies in its localized expertise, focusing on urban properties in Zurich and other key Swiss cities. The company’s active asset management strategy allows it to optimize rental income and property valuations. However, its relatively small scale (CHF 322 million market cap) limits its ability to compete with larger Swiss real estate firms in terms of portfolio diversification and capital deployment. Unlike some competitors with international exposure, SF Urban Properties remains domestically focused, which reduces currency risk but also caps growth potential. Its low leverage compared to industry peers (though still significant) provides some financial flexibility. The company’s rebranding in 2019 reflects a strategic emphasis on urban development, differentiating it from traditional property investors. However, competition from larger players with stronger balance sheets and broader portfolios remains a challenge.

Major Competitors

  • Sika AG (SIKA.SW): Sika AG is a global specialty chemicals company with a strong presence in construction and real estate solutions. While not a direct competitor in property ownership, its building materials segment competes indirectly with SF Urban Properties’ development projects. Sika’s global reach and R&D capabilities give it an edge in innovation, but it lacks SF Urban Properties’ focus on Swiss urban real estate.
  • PSP Swiss Property AG (PSPN.SW): PSP Swiss Property is a major Swiss real estate investor with a larger portfolio (CHF 8+ billion market cap) focused on commercial properties. Its scale and liquidity provide advantages over SF Urban Properties, but its emphasis on office spaces differs from SF Urban’s mixed-use strategy. PSP’s lower leverage and higher dividend yield make it a stronger income play.
  • Roche Holding AG (ROG.SW): Roche is primarily a healthcare company but holds significant real estate assets in Switzerland. Its property holdings are mostly for operational use, so it does not directly compete with SF Urban Properties in investment or development. However, Roche’s financial strength could allow it to expand into real estate if desired.
  • Julius Baer Gruppe AG (BAER.SW): Julius Baer, a private banking group, invests in real estate as part of its wealth management services. While not a direct competitor, its high-net-worth client base overlaps with SF Urban Properties’ potential residential buyers. Julius Baer’s financial services expertise contrasts with SF Urban’s property-focused model.
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