Share prices surge significantly following analyst approval at Deutz
Deutz AG, a leading manufacturer of internal combustion engines, has reported a robust financial performance for the first half of 2025. The company's shares reached their highest level since summer 2019, climbing as much as 13%, and generating a fresh buy signal [1].
The German-based company recorded a 15% increase in revenue, reaching €1.01 billion, with key contributors being higher average selling prices and the acquisition of HJS Emission Technology in June 2025 [1][3]. Despite a 9.1% decline in unit sales, Deutz demonstrated resilience in a challenging market environment [1][3].
The adjusted operating result (EBIT) improved by around 16% in the second quarter, reaching approximately €518 million [2]. Orders at Deutz are up around 30% compared to the same period last year, supporting expectations for the full year [1].
CEO Sebastian Schulte confirmed the company's annual targets, with expected revenue between €2.1–2.3 billion and an adjusted EBIT margin of 5.0–6.0% [1][4]. The ongoing Future Fit cost-saving program is achieving notable results, with €25 million savings targeted in 2025 and €50 million by 2026 [2][5]. Operating cash flow surged to €60.8 million in H1 (vs. €3.3 million prior year) and free cash flow turned positive at €4.5 million [2][5].
The Engines & Services segment, which accounts for 92% of total revenue, showed a 6.8% revenue increase and a 6.1% adjusted EBIT margin, indicating strong performance in industrial/off-highway engines [5]. The newly expanded Solutions segment saw explosive revenue growth of 660.9% to €83.7 million, though it currently reports a negative adjusted EBIT margin of 10.2%, reflecting early-stage expansion costs and market development risks [5].
Overall, Deutz is benefiting from strategic portfolio transformation, successful acquisitions, and efficiency initiatives, which are helping offset market challenges and sustain growth and profitability [2][5]. The company remains cautiously optimistic about a modest market recovery in H2 2025 supported by resolved EU-US tariff disputes [1].
Analysts reacted positively to Deutz's quarterly results, with Oddo BHF describing the report as solid [6]. Michael Schröder, a small-cap expert, offers a stock letter that investors looking for returns outside of major DAX titles might find beneficial [7]. If Deutz's stock surpasses the €9 level, it could quickly approach the psychologically important €10 mark [1].
Deutz maintains its status as one of the top performers in the German small-cap index SDAX this year [1]. The significant increase in orders and profitability exceeded expectations, making Deutz a prime example of how quickly and strongly small-caps can rally. The stock's outlook would be influenced by the company's execution of cost savings, integration of acquisitions, and market demand recovery expected in the latter half of 2025.
[1] - Reuters [2] - Bloomberg [3] - Deutz AG H1 2025 Report [4] - Deutz AG 2025 Guidance [5] - Deutz AG Segment Report [6] - Oddo BHF Research Note [7] - Michael Schröder's Stock Letter
The robust financial performance of Deutz AG, a leading manufacturer of internal combustion engines, has attracted investors in the business and finance sector, as the company's shares have climbed to their highest level since summer 2019 [1]. Deutz AG has successfully transformed its portfolio and executed efficiency initiatives, making it a prime example for small-cap investors looking for returns outside of major DAX titles [1].
