Deutsche Bank initiates Hochtief coverage with data center growth view

Deutsche Bank has initiated coverage of Hochtief with a buy rating, citing the German construction and services group’s exposure to the expanding data center sector as a key driver of measured upside potential.

The bank’s analysts highlighted Hochtief’s involvement in multiple data center projects across Europe and the U.S., positioning the company to benefit from sustained demand for digital infrastructure amid cloud computing and AI adoption. While Deutsche Bank acknowledged near-term macroeconomic headwinds, it emphasized Hochtief’s diversified portfolio and long-term contracts as mitigating factors.

The buy recommendation comes as Hochtief’s stock has underperformed broader European construction peers in recent months, despite a pickup in project awards. Analysts noted that the company’s shift toward higher-margin, specialized construction services—particularly in data centers—could support margin expansion over the coming quarters.

Deutsche Bank set a price target of €120 per share for Hochtief, implying a potential upside of approximately 15% from current levels. The target reflects a blend of discounted cash flow analysis and peer comparisons, with the bank citing a 10% compound annual growth rate in Hochtief’s data center-related revenue through 2027.

Hochtief’s shares were trading marginally higher in early European trading on Thursday, though volumes remained subdued ahead of the bank’s formal initiation of coverage.