Classification of NuWays AG to Multitude AG

Company Name:	Multitude AG
ISIN:	CH1398992755
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 12
Target price on sight of:	12 months
Last rating change:
Analyst:	Julius Neittamo

Q3 preview: Sortter and Wholesale to drive profit growth

Multitude reports Q3'26 tomorrow. We expect strong yoy net profit growth, driven by the first full quarter of Sortter and continued momentum in Wholesale Banking, a fast-growing and highly profitable segment.

We forecast revenue up 18% yoy to € 73.8m in Q3'26. Fee and commission income is seen to triple to € 12m, with Sortter contributing an estimated € 6m (eNuW). Mind you, the core business was already strong before the acquisition. In Q1'26, before any Sortter contribution, fee income doubled. Excluding Sortter, we still see fee income up 50% yoy.

We are cautiously optimistic on interest income growth. Q1 and Q2'26 were the first back-to-back quarters of sequential growth since 2024. With the microloan wind-down largely complete, Q3'26 is the last quarter carrying a yoy drag from last year’s divestments. We forecast interest income up 6% yoy and 7% qoq to € 61.8m. By segment, Consumer Banking should come in flat yoy at € 44m and SME Banking up 5%, held back by a tough macro backdrop for European SMEs. Wholesale Banking looks set to keep growing strongly, up 50% yoy to € 8.5m. Though still relatively small, the segment is highly margin accretive, with a pre-tax margin of 34% in H1'26 versus 14% for the group.

We expect impairments to fall 14% yoy to € 16.4m, or 6.5% of the gross loan book (LTM). First, the exit from riskier microloans has de-risked the Consumer Banking book, which drives the absolute decline. This reflects Multitude’s strategy, which has been to originate in lower-risk, lower-yield markets and monetise the riskier ones through the platform and brokerage. Second, Wholesale Banking is a growing share of the loan book, which lowers the group’s impairment ratio. Its annualised cost of risk was below 1% in H1'26, versus c. 11% in Consumer Banking.

On operating costs, we expect a cost-to-income ratio of 58% (Q2'26: 52%). We see it staying elevated through FY26, reflecting investment in Wholesale Banking and the partnership business, plus PPA amortisation from Sortter.

We forecast net profit of € 8.1m, up 33% yoy, driven by Sortter, Wholesale Banking and lower impairments.

Last Friday, Multitude Bank placed € 50m of perpetual AT1 bonds, which will settle on 13 November. The issue strengthens regulatory capital without diluting shareholders and creates room to grow the loan book, particularly in Wholesale Banking. At 3-month EURIBOR + 9.0%, currently c. 11.8%, it is not cheap: c. € 5.9m a year. As the bonds qualify as equity, the coupon does not hit net profit but reduces earnings attributable to shareholders. We will add the issue to our estimates after the Q3 results.

Minor adjustment to our model. We trim the share of results from Lea Bank to € 1.6m in H2'26 (was € 2.3m). Our FY26 net profit forecast falls to € 31.3m (was € 31.9m), still above the € 30m guidance.

We reiterate BUY with a € 12 PT, based on our residual income model.

You can download the research here: multitude-ag-2026-11-11-update-en-1ade6
For additional information visit our website: https://www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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