Bioretec Q4'25: Groundwork for improved commercial execution

Translation: Original published in Finnish on 2/15/2026 at 7:40 pm EET.

Bioretec's year-end fell short of our estimates. The company has been rebuilding its commercial foundation during 2025 and aims to restore damaged investor confidence. To finance its growth strategy, the company announced it was considering a rights offering of 15 MEUR, which was negatively received by the market. We are adding our estimate of the upcoming offering to our forecasts, which will significantly increase the number of shares. After a sharp decline in the share price, we believe the stock's risk/reward ratio has become cautiously attractive, despite the high commercialization and financing risks. We raise our recommendation to Accumulate (was Reduce) and lower our target price to EUR 0.32 (from EUR 0.60). 

Groundwork for improved commercial execution

Bioretec's Q4 revenue was 0.73 MEUR, which fell short of our 1.00 MEUR estimate. The subdued year-end was not a particular surprise, as the company had already tempered growth expectations with earlier comments. Full-year 2025 revenue was 3.5 MEUR, representing a significant year-on-year decrease, with comparability affected by inventory buybacks. In any case, 2025 was a major disappointment in terms of growth. Bioretec has been actively building and reorganizing its commercial operations since last summer, and we believe the new foundation is stronger than before, both in terms of recruitments and the sales model. The result was also slightly weaker than our forecasts due to the lower revenue. Operating costs were in line with our expectations.

Share issue planned to implement strategy

Due to commercial difficulties, the company needs significant new funding to implement its growth strategy. The company announced on Friday morning that it is planning a 15 MEUR rights offering. We estimate the potential subscription price per share in the offering to be EUR 0.2, which would represent a 33% discount to Friday's closing price. No decision has been made yet regarding the offering, so there is no detailed information on its terms. Should the offering materialize as we estimate, it would mean an increase in the number of shares by over 200%. The ownership of existing shareholders would thus be significantly diluted if they did not participate in the offering. The company's more detailed plans and future share price movements may naturally have a significant impact on the realization of the offering and its terms.

Our forecasts now include successful share issue

We model the offering into our forecasts with the above assumptions. In our view, the committed largest shareholder supports the success of the issue. On the other hand, weakened market confidence may pose challenges to the execution. We are also making small revisions to our 2026 estimates but otherwise leaving our forecasts for future years largely unchanged. We significantly lowered our estimates in connection with the strategy update at the end of last year, and they are roughly in line with the company's targets. We believe the targets are now realistic and achievable, or even surpassable.

The valuation offers opportunities with high risk

The valuation of the stock has fallen to a very low absolute level due to the difficulties and the announcement of the rights issue. If successful, the issue would provide the company with financial breathing room to implement its strategy at least until H2'28, although additional funding may still be needed thereafter. We believe that with financing in place, the company has the preconditions to achieve growth and gradually restore confidence. Despite the current difficulties, we again see the stock's valuation as attractive (2027 EV/S: 3.4x). The stock's risk profile is very high, and the possibility of losing capital is realistic. However, we believe that the high risk is adequately compensated.