Stock Analysis & Valuation dormakaba Holding AG (DOKA.SW)

• Previous Close: CHF58.10
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, CHF	Upside, %
Artificial intelligence (AI)	80.95	39
Intrinsic value (DCF)	30.97	-47
Graham-Dodd Method	5.50	-91
Graham Formula	21.71	-63

Strategic Investment Analysis

Company Overview

dormakaba Holding AG is a global leader in access and security solutions, headquartered in Rumlang, Switzerland. Founded in 1862, the company operates across five key segments: Access Solutions AMER, APAC, DACH, and EMEA, as well as Key & Wall Solutions. dormakaba provides a comprehensive portfolio of products, including door hardware, electronic access systems, lodging solutions, safe locks, and movable walls, catering to diverse sectors such as hospitality, retail, healthcare, and commercial real estate. The company's innovative technologies, such as Legic SmartCard and Connect, enhance security and convenience for clients worldwide. With a strong presence in over 130 countries, dormakaba leverages its Swiss engineering heritage to deliver high-quality, reliable solutions. Its well-known brands, including Silca and Ilco, reinforce its market position. As part of the Industrials sector, dormakaba plays a critical role in the Security & Protection Services industry, addressing growing demand for advanced access control in an increasingly security-conscious world.

Investment Summary

dormakaba presents a mixed investment profile. On the positive side, the company boasts a strong global footprint, diversified revenue streams, and a reputation for high-quality security solutions. Its CHF 2.84 billion revenue and CHF 42.2 million net income in the latest fiscal year reflect stable operations, while a dividend of CHF 8 per share offers income appeal. However, investors should note the company's moderate beta of 1.051, indicating market-correlated volatility, and a relatively high debt load of CHF 605.1 million against cash reserves of CHF 150.4 million. The security solutions market is competitive, requiring ongoing R&D investment, as seen in the CHF 61.6 million capital expenditure. Long-term growth prospects appear solid given increasing global security needs, but margin pressures and integration risks in diverse markets remain considerations.

Competitive Analysis

dormakaba competes in the global access solutions market through differentiated product breadth and technological innovation. Its competitive advantage stems from: (1) Comprehensive product portfolio spanning mechanical and electronic solutions, allowing cross-selling opportunities; (2) Strong brand equity in high-security applications, particularly in Europe; (3) Proprietary technologies like Legic SmartCard that create switching costs; and (4) A service-oriented approach in key verticals like hospitality. However, the company faces pressure from lower-cost Asian manufacturers in volume segments and must continually invest to match the digital innovation pace of tech-focused rivals. Its DACH region focus provides stability but may limit growth compared to more Americas-centric peers. dormakaba's B2B model and engineering expertise defend margins but require balancing customization with scalability. The Key & Wall Solutions segment provides differentiation but is niche compared to broader security players. Overall, dormakaba holds a middle position—less diversified than conglomerate competitors but more specialized than pure-play electronic security firms.

Major Competitors

• Allegion plc (ALLE): Allegion is a stronger player in the Americas with brands like Schlage and Von Duprin. It outperforms dormakaba in electronic access control but has less diversified geographic revenue. Allegion's higher margins (approx. 20% EBITDA vs. dormakaba's ~15%) reflect pricing power but also greater exposure to competitive US markets.
• Assa Abloy AB (ASSA-B.ST): The global market leader with 2x dormakaba's revenue. Assa Abloy's scale advantages in manufacturing and distribution are formidable, though dormakaba retains edge in certain high-security niches. Assa's aggressive M&A strategy (e.g., recent acquisition of Spectrum Brands' hardware division) continually expands its competitive moat.
• SIXT Group (SIX.SW): Local competitor in Swiss market with overlapping product lines. Sixt is smaller but benefits from stronger brand recognition in residential security. dormakaba outperforms in commercial and institutional segments where technical sophistication is prioritized over brand.
• N-able, Inc. (NABL): Pure-play cloud-based access control competitor. N-able threatens dormakaba's electronic systems business with superior software integration but lacks mechanical security expertise. Its SaaS model drives recurring revenue—an area where dormakaba is playing catch-up.
• Gemalto NV (GTO.AS): Now part of Thales Group, Gemalto leads in digital identity solutions that compete with dormakaba's Legic technology. Stronger in government and banking sectors but weaker in physical access hardware where dormakaba retains advantage.