ABM Industries is a top name for investors looking for small-cap exposure, Deutsche Bank said. Analyst Faiza Alwy named the facility management company a best small-cap value pick. Her $65 price target implies the stock could rally 49.1% in the next year from Tuesday's close. The stock is an "underappreciated defensive story alongside new growth avenues, trading at a compelling valuation," she said in a note to clients Tuesday. "ABM remains our top value pick in the space." While investors are focused on commercial real estate headwinds, ABM is somewhat protected because of its focus on Class A properties, which are "destination" buildings, she said. Also, the company has insulated itself from inflationary wage pressures and availability challenges because of its exposure to unions, with about two-thirds of its direct labor having collective bargaining agreements, Alwy said. Those agreements, which in many cases have fixed raises through 2025, can keep workers from squeezing more money out of the company amid rising inflation, she said. ABM also has a flexible labor model, meaning services can be pulled back in an economic downturn. That also allows the company to adapt to changes needed by clients and find new ways to increase efficiency, Alwy noted. Looking ahead, the analyst expects the company to differentiate itself by focusing on data and analytics, which should make it more efficient than its competitors. ABM is using sensors to gather data on various aspects of operations such as occupancy and energy usage to find areas to save money. It's also creating an app for staff to improve the attendance process and help clarify work schedules. She said there's a "multi-year growth opportunity" following the acquisition of RavenVolt, which installs electric vehicle charging stations. ABM said it secured an installation contract with a large auto manufacturer, and the company also has about $450 million in project backlogs that can boost growth in 2023 and 2024. While Alwy noted EV charger installation can be a low-margin business, there's an opportunity in the full-turnkey business, which has higher margins. The RavenVolt acquisition also allowed ABM to enter the business of microgrids, which generate power from local sources and renewable energy to supplement the power grid. ABM's clients may want to switch to microgrids to save money and take advantage of environmental benefits as electricity rates rise in peak hours, she said. — CNBC's Michael Bloom contributed to this report.