Deutsche Bank: Solid Execution, Discounted Valuation and Capital Returns Underpin Buy Rating

Bank of America Securities analyst Tarik El Mejjad reiterated a Buy rating on Deutsche Bank AG today and set a price target of €37.00.

Tarik El Mejjad has given his Buy rating due to a combination of factors that highlight Deutsche Bank’s solid execution and attractive valuation. The bank closed 2025 by meeting or slightly exceeding its key targets, including return on tangible equity, cost efficiency, and cumulative shareholder distributions, supported by a confirmed €1 dividend per share and a €1bn share buyback. He views the new business plan as starting from a strong base, with the stock still pricing in a discount at around 9x earnings and 0.9x tangible book value relative to an expected return on tangible equity of roughly 12.6% by 2027.

Tarik El Mejjad’s rating is based on the view that the 2026 outlook offers further upside, particularly on revenues where his team is above consensus, driven mainly by stronger net interest income in the Private and Corporate Banks and better capital markets conditions. He also takes confidence from the robust performance of the Asset Management division in Q4, strong fee generation, and positive deposit dynamics in both the Corporate and Private Banks, alongside a growing deal pipeline in investment banking. In addition, Deutsche Bank continues to optimize risk‑weighted assets, has already exceeded its RWA optimization targets, and maintains a solid CET1 ratio even after accruing for generous shareholder payouts, which supports the case for higher payout ratios from 2026 onward. Overall, the combination of earnings momentum, capital strength, improving profitability, and prospective capital returns underpins his Buy recommendation.

In another report released today, RBC Capital also maintained a Buy rating on the stock with a €38.00 price target.