Multitude

On Investor Day, the focus is on the companies as they each share their updates.

15:31

Antti Kumpulainen, CEO, talks about the digital bank Multitude as an investment. Multitude offers lending and online banking services to consumers, small and medium-sized businesses, and other fintechs overlooked by traditional banks.

Multitude’s Q3 numbers slightly missed our estimates, but on a positive note, asset-light fee income kept growing fast and impairment losses kept decreasing.

Multitude’s growth in Q3 was slower than we had expected, but profit was largely in line with our estimates, driven by very good growth in fee income and a continued positive trend in impairment losses.

We anticipate continued growth driven by smaller segments, such as SME Banking and Wholesale Banking, as well as fee income.

Multitude’s Q2 profit improvement exceeded our expectations and was driven mainly by decreasing impairment losses and good growth in fee income, which can potentially be a good asset-light growth driver in the future. This year’s guidance was reiterated, although we see it as rather conservative and see a chance that it will be adjusted upwards.

Multitude’s growth in Q2 was slower than we estimated, but profit exceeded our expectations clearly, indicating that the company’s focus on profitability is paying off. The profit guidance was reiterated, but based on our initial reaction, we believe the likelihood for another positive guidance revision has increased.

Multitude will report its Q2’25 results on the morning of August 21. We expect continued growth, driven by the smaller business units (SME Banking & Wholesale Banking) and a clear profit improvement from the comparison period, driven mainly by an improved impairment loss ratio.

Multitude’s stock has continued its positive trend after its strong Q1 results. The earnings-based valuation is not expensive, but with the risen balance sheet-based valuation, the expectations of the future sustainable returns on equity have elevated clearly. We feel the valuation has reached a neutral level (P/B 1.0x) and thus the risk/reward ratio has somewhat weakened, and we believe that the best buying opportunities have been left behind.

Multitude’s growth in Q1 was slightly below our expectations, but the profit beat our estimates clearly driven by declining impairment losses. The guidance was adjusted upwards, and although it was no major surprise, it gave more confidence toward the earnings growth outlook going forward. Given the improved performance, we still find the valuation attractive.

While Multitude's Q1 growth was slightly lower than our estimates, its profit performance was better than expected even though our original estimates had already factored in a significant profit improvement for the quarter.

Multitude will report its Q1’25 results on Thursday morning, May 22. We expect continued growth and a significant increase in earnings compared to the same period last year, which was shadowed by elevated impairment losses.

Multitude’s Q4 results exceeded our expectations due to lower-than-expected impairment losses, where the trend has also been positive in the last few quarters.

Multitude reported stronger-than-expected Q4 numbers. Total net operating income growth came in as expected, and the profit beat was mainly due to lower-than-expected impairment losses. Guidance for 2025 and 2026 was unchanged.

Multitude hasn’t given any preliminary announcements of its Q4 numbers, and thus the company will most likely reach its guidance range. As our estimate was slightly below the range, we made small positive estimate revisions before the earnings.