Deutsche Bank has moved DocMorris AG from a "hold" to a "buy" recommendation and raised its target price to 11.50 Swiss francs from 5.50 francs, arguing that the stock now presents a more attractive risk/reward profile.
Analyst Jan Koch outlined four central reasons for the upgrade: a likely upside to 2026 guidance, a reduction in the company’s funding needs, a regulatory environment that is becoming more supportive, and what Deutsche Bank sees as the underappreciated value of TeleClinic within DocMorris’ digital health portfolio.
"Following a period dominated by concerns over funding needs and execution risk, we believe the investment debate is shifting towards earnings growth, cash flow improvement and the monetisation of DocMorris’ digital health ecosystem," Koch said.
DocMorris shares last closed at 8.58 francs. Deutsche Bank indicated that recent trading updates point to faster revenue momentum, and that regulatory developments may help bolster both profitability and long-term growth potential.
In April, DocMorris reported first-quarter revenue of 318.1 million francs, a year-on-year increase of 10.7% in local currency, which exceeded expectations. Adjusted EBITDA improved by almost 10 million francs year-on-year to negative 6.3 million francs in the first quarter, keeping the company on course to reach break-even by the fourth quarter at the latest.
Growth in German prescription drug sales was especially strong, rising 30.4% year-on-year in local currency to 68.1 million francs. Management said this surge was driven by the rollout of bonus incentives on co-payments and that prescription growth accelerated further in March.
Other business lines also expanded: non-prescription sales rose 6.5% year-on-year in local currency, and digital services - a category that includes TeleClinic, retail media and marketplace - grew 63.1%. Active users on DocMorris’ platform reached 12.6 million at the end of March, up 3.3% from the prior quarter.
For fiscal 2026, DocMorris reiterated guidance for external revenue growth in the mid-single-digit to low-teens range and projected adjusted EBITDA between negative 10 million and negative 25 million francs. The company maintains a target of achieving free cash flow break-even in 2027.
Context and implications
Deutsche Bank’s upgrade shifts the focus from earlier concerns - namely funding and execution risk - toward operational metrics such as revenue trajectory, cash generation and potential monetisation of the company’s digital health offerings. The bank’s revised price target more than doubles its prior valuation, reflecting the view that earnings and cash flow improvements are becoming the dominant drivers of value.