Deutsche Bank initiated coverage of Verisure (STO:VSURE) with a Buy rating on Monday, setting a price target of EUR18, representing approximately 18% upside from the security firm’s last closing price of EUR15.30.

The bank highlighted Verisure’s position as a leading provider of professionally installed and monitored security services, operating in a large, growing, and fragmented market.

Deutsche Bank noted the company’s highly recurring, cash-generative subscription model is driving double-digit profit growth with returns on investment exceeding 20%.

Verisure’s competitive advantages stem from its scale, integrated value chain spanning sales, installation, product design, monitoring and service, along with strong brand recognition.

Despite being five times larger than its nearest competitor, the company holds only approximately 4% market share, suggesting significant room for expansion.

Deutsche Bank identified multiple growth avenues for Verisure, including capturing additional market share, international expansion, and rising overall market demand for professionally monitored security services.

The bank views technological advancement as a growth enabler for the business that facilitates product innovation and drives adoption.

The analysis also acknowledged potential long-term risks, noting that while technology creates opportunities for Verisure, it may also increase competition and introduce new challenges over time.