Original-Research: DO & CO AG (von NuWays AG): BUY

Classification of NuWays AG to DO & CO AG

Company Name:	DO & CO AG
ISIN:	AT0000818802
Reason for the research:	Update
Recommendation:	BUY
from:	06.10.2025
Target price:	EUR 266.00
Target price on sight of:	12 months
Last rating change:
Analyst:	Henry Wendisch

Conference Feedback: Rare value proposition for good money

Last week, we hosted DOC at our European MidCap Event in Paris. Here are our key takeaways from the discussions with investors:

Unique business model in high demand. DOC’s business models is based on the principles of continuous innovation and being able to provide an excellent customer experience, whose foundation lies in the strong roots of perfectionistic restaurant-, hotel- and catering offering. In doing so, international event organizers as well as Airlines use DOC to differentiate from its competitors as well as increase their own customer satisfaction. This gives DOC the luxury to choose their customers and not vice versa, which is also showing in superb contract renewal rate of 95% as well as 5-10 new customer wins per quarter (largely smaller airlines at already present hubs).

Strong partnerships secure sales visibility. As a consequence of the above mentioned drivers, DOC counts the most prestigious partners. Just to name a few, DOC is catering for Formula 1 races since 1992, for UEFA since 2002, Turkish Airlines since 2002, Austrian Airlines since 2000 and FC Bayern / Allianz Arena Munich since 2014. All in all, this leads to currently 70% of group sales to be contract based until 2030, providing excellent sales visibility.

Margin protected business. DOC’s business model is extremely margin protective due to a large share of contract based revenues. More specifically, the Airline Catering (AC) segment currently operates with 1/3 of sales using open-book accounting on which a fixed margin is agreed upon. Of the remaining 2/3 of AC sales, 1/3 of sales are generated from a fixed contracted handling fee to cover the fixed costs of a local kitchen and 2/3 are variable sales, i.e. stemming from the number of meals cooked. In addition, all contracts have minimum wage and raw material inflation clauses, allowing DOC to pass on costs that are not in their control. All this leads to a lean, breathable cost structure with c. 80% of sales being variable costs (40% COGS, 40% personnel costs).

Continuously rising margins. As a direct result of ongoing customer wins, operating leverage is seen to kick in. Especially the smaller customer wins, increase the utilization rate (currently 70-80%) of the 33 kitchen worldwide. For instance, cooking 120 meals vs. 100 meals usually incurs the same fixed costs (same chef, same kitchen). This effect was strongly visible in Q1, which showed a 26% incremental EBIT margin. Moreover, DOC has reached better negotiating power and scale effects, further supporting margin growth (10% EBIT margin target).

Dividend payout ratio targeted at 25% implies strong dividend growth. In FY’24/25, DOC paid out a € 2 DPS (23% payout ratio). During discussion, DOC highlighted to target a 25% payout ratio going forward, which would lead to a € 2.78 DPS for FY’25/26e, according to our estimates. This would imply a 39% yoy DPS growth, but also a mere 1.3% dividend yield.

All in all, the management discussions confirmed our positive view on the stock. Therefore, we reiterate our BUY recommendation with an unchanged PT of € 266, based on DCF.

You can download the research here: do-co-ag-2025-10-06-update-en-d7412
For additional information visit our website: https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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