Finbar Group's (ASX:FRI) gross profit is expected to return to its typical level of around 20% by 2026 and beyond, Euroz Hartleys said in a Wednesday note.

The company has experienced sufficient increases in price and is selling into the affordable end of the market while having access to the sole source builder Hanssen, according to the note.

Finbar Group has achieved "very strong presale positions," with 80% of the Riverbank project, 100% of the Bel-Air project, and over 70% of the Garden Towers project already presold for delivery into fiscal years 2026 or 2027.

In the first two months of fiscal 2026, the company sold AU$114 million, nearly half of the AU$236 million it sold in all of fiscal 2025. The monthly sales rate has more than doubled to around 60 per month year-to-date from 24 per month in 2024.

The investment firm said Finbar Group is positioned to generate meaningful and sustained earnings starting in the second half of 2026 or the first half of 2027.

Euroz Hartleys maintained its buy rating on Finbar Group and lifted its price target to AU$1.04 per share from AU$1 per share.

The company's shares rose 3% in afternoon trade on Thursday.