Deutsche Börse DB1.DE
What does Deutsche Börse do?
Deutsche Börse operates an international exchange organization with a focus on Germany and Europe, as well as activities in the United States and the Asia-Pacific region. The business is divided into four segments: Investment Management Solutions, Trading & Clearing, Fund Services and Securities Services. Customers include banks, institutional investors, asset managers, fund companies and corporates.
Revenue is generated predominantly through fees: for trading and clearing of equities, derivatives, commodities, currencies and digital assets, for settlement, custody and fund services, and for data, indices, analytics and software. Competitively, the company benefits from network effects, high switching costs and the integration of trading, clearing, settlement and custody along the value chain. It holds a strong position in European derivatives trading and securities custody, but competes with other exchange operators, alternative trading venues and data providers.
Score profile
Rank vs. Financial Data & Stock Exchanges (12 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, Deutsche Börse ranks in the middle in the group Financial Data & Stock Exchanges (5.0/10). On growth, the company ranks above average in the group Financial Data & Stock Exchanges (7.1/10). On valuation (higher = cheaper), the stock ranks in the middle in the group Financial Data & Stock Exchanges (4.6/10). On financial strength, Deutsche Börse ranks in the middle in the group Financial Data & Stock Exchanges (5.0/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 23.4x | 23.4x | better than 46 % |
| Trailing P/E | 26.5x | 25.9x | better than 41 % |
| PEG ratio | 2.9x | 1.9x | better than 21 % |
| Price/sales | 7.1x | 7.8x | better than 63 % |
| Price/book | 5.3x | 5.3x | better than 50 % |
| Revenue growth | 16.2% | 12.3% | better than 88 % |
| Earnings growth | 19.8% | 18.8% | better than 54 % |
| Gross margin | 80.0% | 77.3% | better than 54 % |
| Operating margin | 41.5% | 43.9% | better than 46 % |
| Net margin | 27.4% | 29.3% | better than 38 % |
| Return on equity | 20.3% | 17.6% | better than 63 % |
| Debt/equity | 72.2% | 74.6% | better than 54 % |
| Current ratio | 1.0x | 1.0x | better than 38 % |
| Free cash flow yield | 0.0% | 3.1% | better than 4 % |
| Dividend yield | 1.3% | 1.1% | – |
| Payout ratio | 34.7% | 27.8% | – |
| Beta | 0.27 | 0.93 | – |
Valuation: what is Deutsche Börse worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give Deutsche Börse a model range of 320.32 EUR to 320.80 EUR per share.
14 analysts, average rating “Buy”, average price target 312.07 EUR (−2.7%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- Trading and clearing volumes, driven by market volatility and investor activity, largely determine transaction-based revenue.
- Recurring revenue from data, indices, software as well as custody and fund services stabilizes the business independently of trading volumes.
- The level of interest rates affects income from client funds and collateral in the clearing and custody business.
Risks
- Regulatory changes in market structure, clearing and capital requirements can impair business models and margins.
- Competition from alternative trading venues, rival exchanges and data providers can put pressure on market share and prices.
- Outages, cyberattacks or errors in critical market infrastructure endanger reputation and can have significant liability consequences.
What to look for with Deutsche Börse
The share of recurring revenue in total revenue is informative, as it shows how strongly earnings depend on fluctuating trading volumes.