Update shared on22 Oct 2025
Fair value Increased 0.29%Rheinmetall’s analyst fair value target rose slightly from €2,161.56 to €2,167.81. Analysts see sustained sector momentum and increased order visibility supporting modest upside for the shares.
Analyst Commentary
Recent street research on Rheinmetall reflects a robust debate over the company's growth prospects, valuation, and near-term execution. While most analysts maintain a constructive stance, there is also caution regarding the stock’s current valuation and pace of order momentum.
Bullish Takeaways- Several bullish analysts have raised their price targets, highlighting sustained sector momentum and an increasingly visible order pipeline.
- Germany’s focus on defense modernization and Rheinmetall's strong domestic exposure are seen as key supports for forward growth.
- The current rearmament cycle is viewed as the most significant since the early Cold War. This cycle offers long-term growth tailwinds for the company.
- Buy ratings dominate recent coverage. Analysts consider the company well-positioned to benefit from increased defense spending across Europe.
- Bearish analysts caution that recent share price strength leaves the stock "priced for perfection," which could potentially limit further upside in the near term.
- High sector valuations and market enthusiasm may require careful investor selection and could introduce volatility if growth expectations are not met.
- Some new initiations take a more neutral or selective approach, citing risks around execution and the realization of booking-to-bill momentum into tangible earnings growth.
- While order visibility remains strong, the company's high valuation creates a higher bar for future performance and continued re-rating.
What's in the News
- Rheinmetall is preparing to sell its civilian businesses in the first quarter of 2026 as part of a strategy to transform into a one-stop shop for land, sea, and air defence. (CEO Armin Papperger interview, September 2025)
- The company is seeking to enter the shipbuilding industry, expanding its defence offerings to include management centres, missile systems, launchers, and simulation systems. (CEO Armin Papperger interview, September 2025)
- Rheinmetall is reported to be interested in acquiring German shipbuilder Naval Vessels Luerssen, whose owners plan to divest military shipyards to focus on building megayachts. The potential purchase is under consideration by Rheinmetall's supervisory board. (Bild, August 2025)
Valuation Changes
- Consensus Analyst Price Target: The fair value estimate has risen slightly from €2,161.56 to €2,167.81.
- Discount Rate: Increased marginally from 5.58% to 5.61%, which reflects a modest adjustment in perceived risk or market conditions.
- Revenue Growth: Projected revenue growth remains unchanged at approximately 34.86%.
- Net Profit Margin: The outlook for net profit margin is stable, holding steady at about 12.48%.
- Future P/E: The expected future price-to-earnings ratio has increased slightly from 41.29x to 41.45x.
Disclaimer
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