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1. Company Snapshot

1.a. Company Description

Deutsche Post AG operates as a mail and logistics company in Germany, rest of Europe, the Americas, the Asia Pacific, the Middle East, and Africa.The company operates through five segments: Express; Global Forwarding, Freight; Supply Chain; eCommerce Solutions; and Post & Parcel Germany.The Express segment offers time-definite courier and express services to business and private customers.


The Global Forwarding, Freight segment provides air, ocean, and overland freight forwarding services; and offers multimodal and sector-specific solutions.This segment's business model is based on brokering transport services between customers and freight carriers.The Supply Chain segment delivers customized supply chain solutions to its customers based on modular components, including warehousing and transport services; and value-added services, such as e-fulfilment, omnichannel solutions and returns management, lead logistics partner, real estate solutions, service logistics, and packaging solutions for various industrial sectors.


The eCommerce Solutions segment provides parcel delivery and cross-border non-time definite international services.The Post & Parcel Germany segment transports and delivers mail communication, parcels, physical and hybrid letters, and special products for the delivery of goods; and offers additional services, such as registered mail, cash on delivery, and insured items.Deutsche Post AG was founded in 1490 and is headquartered in Bonn, Germany.

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1.b. Last Insights on DHL

Deutsche Post's recent performance has been driven by several positive factors. The company's Q4 2025 earnings call highlighted robust financial performance, significant EBIT growth, and strategic cost savings. Additionally, advancements in AI and digitalization have contributed to its growth. A partnership with SHEIN to use sustainable aviation fuel for air cargo operations through its GoGreen Plus service also underscores the company's commitment to reducing carbon emissions. Furthermore, DHL's investments in a unified parcel network have paid off during peak shipping seasons, such as Easter. A 20% pay increase for DHL employees over four years also boosts morale.

1.c. Company Highlights

2. DHL Group's 2025 Earnings: A Strong Performance

DHL Group's 2025 performance delivered on guidance, with EBIT increasing to EUR 6.2 billion and an 8% year-on-year growth in earnings per share. The actual EPS came out at EUR 0.936, slightly below estimates of EUR 1. The company generated a free cash flow of EUR 3.2 billion and executed its finance policy to provide good shareholder returns, including a historical dividend increase and EUR 1.5 billion remaining to be spent on share buyback programs.

Publication Date: Mar -06

📋 Highlights
  • EBIT Growth & EPS Increase:: EBIT reached EUR 6.2 billion in 2025, with EPS up 8% year-on-year.
  • Free Cash Flow & Shareholder Returns:: Generated EUR 3.2 billion free cash flow and EUR 1.5 billion remaining for share buybacks.
  • Fit for Growth Cost Savings:: Delivered EUR 600 million structural savings in 2025, exceeding targets and targeting EUR 400 million in 2026.
  • Divisional Performance Highlights:: DHL Express achieved sixth consecutive EBIT growth, while Post & Parcel Germany and e-commerce recorded highest Q4 operating contribution.
  • 2026 Guidance:: EBIT expected to exceed EUR 6.2 billion, with free cash flow of EUR 3 billion and tax rate around 30%.

Divisional Performance

In terms of divisional performance, DHL Express saw the sixth consecutive quarter of EBIT growth, driven by effective yield, cost, and capacity measures. Post & Parcel Germany and DHL e-commerce achieved a successful peak season, locking in the highest operating contribution of the year in the fourth quarter. DHL Forwarding Freight showed structural improvement potential, while DHL Supply Chain delivered top and bottom line growth.

Cost Savings and Guidance

The company's "Fit for Growth" program delivered significant structural cost savings of EUR 600 million, ahead of initial indications. DHL's guidance for 2026 is for EBIT to exceed EUR 6.2 billion, with a free cash flow of around EUR 3 billion and a tax rate of around 30%. The company expects further profit growth in 2026, driven by leveraging growth opportunities in countries, trade lines, and sectors where its logistics expertise can drive sustainable, accelerated growth.

Valuation Metrics

With a P/E Ratio of 14.68 and an EV/EBITDA of 6.65, the market seems to have priced in a reasonable level of growth. The Dividend Yield stands at 4.03%, indicating an attractive return for income investors. The ROIC of 8.08% suggests that the company is generating returns above its cost of capital, but there is room for improvement.

Operational Highlights

DHL is focusing on smart industrial growth, particularly in B2B verticals, to increase the weight per shipment and drive growth. The company has a well-established road network in the Middle East, which enables it to bring cargo to open airports, mitigating the impact of disruptions in air activity and ocean-going vessels.

Growth Strategy

DHL's growth strategy focuses on organic growth opportunities, with a continued use of M&A as a supplement. The company aims to accelerate growth while maintaining profitability and cash generation, driven by technology and robotics, with opportunities for cost savings and synergies, particularly in collaboration between divisions.

3. NewsRoom

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JLR manufacturing threatened by possible DHL logistics strike

Apr -17

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Is It Too Late To Consider Deutsche Post (XTRA:DHL) After A 44% One Year Rally?

Apr -13

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New Ownership of PostalAnnex in Spring, Texas Brings Fresh Energy to the Business--Serving the Community with Shipping and Office Services for Nearly 20 Years

Apr -09

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Supply Chain Stocks Soar on Ceasefire News

Apr -08

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New Ownership of Pak Mail in Grand Rapids, Michigan Brings Fresh Energy to the Business--Serving the Community with Shipping and Office Services for More Than 30 Years

Apr -08

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Assessing Deutsche Post (XTRA:DHL) Valuation After Recent Share Price Weakness

Apr -08

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How DHL tackled mail and parcel boom during peak Easter season

Apr -06

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Pharmaceutical logistics in demand as war rattles supply chains

Apr -05

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.01%)

6. Segments

Express

Expected Growth: 4.5%

Express segment growth of 4.5% driven by e-commerce expansion, increased demand for fast and reliable parcel delivery, and investments in digitalization and logistics infrastructure. Pricing power and cost efficiency measures also contribute to growth, as Deutsche Post AG leverages its market position and operational strengths.

Global Forwarding, Freight

Expected Growth: 3.8%

The 3.8% growth in Global Forwarding, Freight from Deutsche Post AG is driven by increasing demand for logistics and e-commerce, efficient network expansion, and strategic acquisitions. Strong performance in Asia and Europe, coupled with a recovering global economy, also contribute to this growth. Digitalization and innovative services further enhance the segment's growth prospects.

Supply Chain

Expected Growth: 4.2%

Deutsche Post AG's supply chain growth of 4.2% is driven by increasing e-commerce demand, efficient logistics infrastructure, and strategic investments in digitalization and automation. The company's strong parcel and express business, as well as its expanding e-commerce services, contribute to this growth. Additionally, its focus on sustainability and customer satisfaction enhances its competitive position.

Post & Parcel Germany

Expected Growth: 2.5%

Post & Parcel Germany's 2.5% growth is driven by e-commerce expansion, increased online shopping, and rising demand for fast and reliable parcel delivery. Deutsche Post AG's investments in logistics and digitalization, such as automated sorting facilities, also enhance efficiency and contribute to growth.

eCommerce

Expected Growth: 6.0%

The eCommerce segment growth of 6.0% for Deutsche Post AG is driven by increasing online shopping, parcel volume growth, and expanding e-fulfillment services. Additionally, the company's strategic investments in digitalization and logistics infrastructure have enhanced its competitiveness, contributing to the segment's growth.

Group Functions

Expected Growth: 2.0%

Group Functions at Deutsche Post AG's growth of 2.0 is driven by synergies from integrated logistics, efficient resource allocation, and strategic investments in digitalization and e-commerce solutions. This enables cost savings, enhanced customer experience, and expanded service offerings, contributing to steady growth.

Consolidation

Expected Growth: 3.0%

Deutsche Post AG's consolidation growth of 3.0 is driven by e-commerce expansion, increased parcel volumes, and efficient logistics. The company's strategic investments in digitalization and automation enhance operational efficiency, while a strong presence in the European market provides a stable foundation for growth.

7. Detailed Products

Parcel and Express Services

Deutsche Post AG offers a range of parcel and express services, including DHL, which provides fast and reliable delivery of packages to individuals and businesses worldwide.

Mail Services

Deutsche Post AG provides mail services, including the delivery of letters and postcards to individuals and businesses in Germany and internationally.

Logistics and Supply Chain Management

Deutsche Post AG offers logistics and supply chain management services, including warehousing, freight forwarding, and customs clearance.

E-commerce Services

Deutsche Post AG provides e-commerce services, including online shopping solutions, payment processing, and delivery services.

Financial Services

Deutsche Post AG offers financial services, including banking and insurance products, through its subsidiary, Deutsche Postbank AG.

Marketing and Advertising Services

Deutsche Post AG provides marketing and advertising services, including direct mail, email marketing, and data analytics.

8. Deutsche Post AG's Porter Forces

Forces Ranking

Threat Of Substitutes

Deutsche Post AG faces a moderate threat from substitutes, particularly from digital alternatives such as e-mails and online bill payments, which have reduced the demand for traditional postal services. However, the company has diversified its services to include parcel delivery and logistics, reducing its dependence on traditional mail services.

Bargaining Power Of Customers

Deutsche Post AG has a large customer base and is a market leader in postal services. Customers have limited bargaining power due to the essential nature of postal services and the lack of close substitutes. However, customers can choose from various postal service providers, which slightly increases their bargaining power.

Bargaining Power Of Suppliers

Deutsche Post AG has a large network of suppliers, including postal service providers and logistics companies. The company has significant bargaining power due to its large volume of purchases and its market leadership position. Suppliers are also dependent on Deutsche Post AG for their business.

Threat Of New Entrants

The threat of new entrants is low due to high barriers to entry, including significant investments required in infrastructure, logistics, and marketing. Deutsche Post AG also has a strong brand and a large customer base, making it difficult for new entrants to compete.

Intensity Of Rivalry

The postal services industry is highly competitive, with many players competing for market share. Deutsche Post AG faces intense competition from both domestic and international players, particularly in the parcel delivery and logistics segments. The company must continually invest in its services and infrastructure to remain competitive.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 48.54%
Debt Cost 6.54%
Equity Weight 51.46%
Equity Cost 9.50%
WACC 8.06%
Leverage 94.32%

11. Quality Control: Deutsche Post AG passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Growth: 4.8

Quality: 5.6

Yield: 10.0

Momentum: 4.0

Volatility: 10.0

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Deutsche Post

A-Score: 6.3/10

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

50.14$

Current Price

50.14$

Potential

-0.00%

Expected Cash-Flows