Translation: Original published in Finnish on 10/23/2026 at 8:00 am EEST.

We reiterate our Reduce recommendation and EUR 0.60 target price for Nurminen Logistics. Of the company's Q3 figures, revenue slightly exceeded our estimate, while the result came in slightly below our forecast. The most positive aspect of the report, in our opinion, was the well-progressed intra-European rail traffic. However, this was overshadowed by the substantial volume decreases expected from North Rail, which we estimate were reflected in the company's profitability, along with the ramp-up of European traffic. Taking these factors under consideration, we raised our growth forecasts for the coming years, though our earnings forecasts were under pressure. We see medium-term potential in the share, but balanced short-term valuation and forecast risks currently outweigh it.

Quite well in line with our expectations operationally

The company's revenue grew by 10% in Q3, which slightly exceeded our estimate (est. +5%). Among the businesses, the Baltic operations mainly drove the estimate beat. On the other hand, the overall development of the Railway business was largely in line with our forecast. Within the business, however, international growth was quite clearly faster than we had expected, and, most importantly, this growth came mainly from the company’s intra-European block train service. On the negative side, however, we estimate that North Rail’s revenue declined even more than we had expected, reflecting its earnings structure. The company's adjusted EBITA was 1.8 MEUR, which was slightly below our forecast of 2.0 MEUR. In addition to North Rail, we estimate that this was driven by costs related to ramping up European traffic, which were higher than expected. Reported earnings were weighed down by 1.2 MEUR in non-recurring costs, which were higher than we expected.

Near-term earnings estimates dropped a little further

Nurminen reiterated its guidance for the current year, in which it expects revenue to reach or fall slightly below the comparison period's level (2025: 109 MEUR). Nurminen estimates comparable EBIT to be clearly below the comparison period (2025: 18.3 MEUR), but remaining at a good profitability level. The company's outlook was largely unsurprising in the big picture, due to declining North Rail volumes and investments in the European block train service. Based on actual developments, we therefore increased our revenue forecasts, particularly for European traffic and more moderately for the Baltics. However, we lowered North Rail's revenue forecasts further, which was also reflected in the bottom line, together with our increased growth investment estimates for European traffic. As a result, we estimate the adjusted EBITA margin for the coming years to be in the range of 8-9% (was 10–11%). Following the estimate revisions, we lowered our operational earnings forecasts for the current and next year by 5–8%, while the forecast for 2028 remained virtually unchanged. We expect the company's revenue to settle at 109 MEUR this year (was 106 MEUR) and adjusted EBIT to be 10.1 MEUR (was 10.6 MEUR).

We find the valuation reasonable

In our view, the success of growth in European traffic is currently at the core of the company's investment story. The geopolitical risks of this business are also clearly lower and the market potential greater than for North Rail and the Baltic business, which currently account for the majority of the company's earnings. Thus, success in this growth would support an acceptable valuation for the stock. Even in a fairly positive scenario, we estimate that clearer positive earnings impacts from the European domestic business at the group level will not be seen until 2028. However, if the company succeeds in international growth, the company and the share’s valuation could look quite different in 3-5 years. Considering the current estimate risks and earnings distribution, however, we find it difficult to see any material upside in the valuation yet (2027e P/E 12x).