Quirin Privatbank Recommends Buy for Deutz AG After Sobek Acquisition

Quirin Privatbank Kapitalmarktgeschäft has updated its recommendation for Deutz AG, upgrading to a "Buy" with a target price of EUR 11.00. This follows Deutz's acquisition of the Sobek group, a specialist in high-performance electric drive and hydraulic systems, particularly for military applications like drones. Sobek, noted for annual sales of EUR 25-30 million and an EBITDA margin over 30%, strengthens Deutz's defence segment.

The acquisition is aligned with Deutz's strategy to enhance its Defence unit through external investments. Currently, the Defence unit comprises around 2% of Deutz's sales, but it is expected to grow substantially. This expansion, coupled with rising margins, could positively influence stock valuation.