Goldman Sachs downgrades Deutsche Bank stock to Neutral on fair valuation

Published 26/08/2025, 22:26
Goldman Sachs downgrades Deutsche Bank stock to Neutral on fair valuation

Investing.com - Goldman Sachs downgraded Deutsche Bank (DBK:GR) (NYSE:DB) stock rating to Neutral from Buy, while maintaining a price target of EUR34.00, citing the stock’s recent rally. The downgrade comes as Deutsche Bank trades near its 52-week high of $37.55, having delivered an impressive year-to-date return of 121%.

The investment bank noted that Deutsche Bank now trades at a price-to-earnings multiple roughly in line with its broader coverage, at 10 times Goldman’s 2025 earnings per share estimate and 9 times its 2026 estimate. According to InvestingPro data, the stock currently trades at a P/E ratio of 11.36x, while analysis suggests the stock remains slightly undervalued based on Fair Value estimates.

Goldman Sachs views this valuation as "broadly fair," with its 12-month price target of EUR34.00 implying 8% upside potential, compared to an average upside of 9% across its coverage universe.

Despite the downgrade, Goldman Sachs expects Deutsche Bank to continue improving its profitability and outperform consensus earnings expectations both this year and next (2025/2026).

The firm also anticipates Deutsche Bank will deliver progressive increases in capital return to shareholders through both dividends and share buybacks.

In other recent news, BofA Securities has reinstated coverage on Deutsche Bank with a Buy rating, setting a price target of €29.00. This decision underscores Deutsche Bank’s strategic advantage in Germany, often referred to as its "Global Hausbank" status. Analysts at BofA Securities anticipate that changes in Germany’s fiscal policies will significantly benefit Deutsche Bank starting in the second half of 2026. They project that Germany’s GDP will grow by 1.5-1.8% in the third and fourth quarters of that year, which could positively impact the bank’s operations. Furthermore, the analysts foresee 2025 as a crucial year for Deutsche Bank as it aims to overcome its low return on tangible equity. The focus is expected to shift towards an improving outlook for the year 2028. These developments are part of the recent analysis by BofA Securities, reflecting their positive stance on Deutsche Bank’s future prospects.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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