After a 37 Percent Year-to-Date Rout, Rheinmetall Counts on Its 73 Billion Order Book and a Pivot to Space
Published on 07/18/2026 at 12:01 | Redaktion boerse-global.de
Rheinmetall’s shares clawed back 1.85 percent on Friday to close at €978.00, offering a brief respite in what has been a punishing stretch for the defence heavyweight. The stock now sits just 8.4 percent above its 52-week low of €902.50, touched on June 25, and has shed more than a third of its value since the start of the year. The 30-day volatility stands at an annualised 69 percent, while the relative strength index at 37.5 points to a market that is shaken but not yet oversold. The 50-day moving average of €1,130.57 remains a full 13.5 percent above the current price, underscoring the magnitude of the recent slide.
The trigger for the rout is clear. In early July, news broke that the German government had halted the F126 frigate programme, a project valued at around €12 billion. The disclosure sent the stock tumbling 18.65 percent in a single session and, according to analysts, will cause Rheinmetall to miss its second-quarter and full-year order intake targets. The company itself expects revenue losses of up to €300 million from the cancellation. Bank of America responded by slashing its price target from €1,770 to €1,300 while maintaining a buy rating, and it trimmed its 2030 revenue forecast for the whole group from €50 billion to €35 billion. Berenberg and Jefferies followed suit, lowering their targets to €1,600 and €1,300 respectively, though all three houses kept positive recommendations.
Against this backdrop, management has signalled its own confidence through share purchases. Chief executive Armin Papperger bought stock worth €3.04 million, while supervisory board member Georgi added €47,665. The company is also pressing ahead with diversification. Rheinmetall has struck a co-production deal with Lockheed Martin to manufacture ATACMS missiles in Germany and signed a letter of intent with Space Norway to develop C?band SAR satellite technology for maritime surveillance. Analysts view these moves, together with an increasing focus on drone technology, as partial compensation for the frigate setback.
Should investors sell immediately? Or is it worth buying Rheinmetall?
The expansion plans extend well beyond new contracts. Rheinmetall expects roughly 280,000 job applications in Germany this year, up from 140,000 in the first half and 250,000 in the whole of 2025. Globally, the target is 400,000 applications. The company aims to double its workforce to 70,000 by 2030, with a growing number of recruits coming from the automotive and technology sectors. To feed its rising production, Rheinmetall has asked domestic steelmakers such as Salzgitter and Dillinger to ramp up military-grade steel output, seeking to reduce dependence on Sweden’s SSAB. Steel demand is expected to double within two years, mirroring the increase in German defence spending, which reached €60 billion in 2025 and is forecast to hit nearly €70 billion in 2026.
For all the near-term headwinds, the order book remains a powerful counterargument. At roughly €73 billion, it dwarfs the revenue lost from the F126 cancellation. Yet the valuation remains demanding: the price-to-earnings ratio sits in the high double-digit or even triple-digit range depending on the earnings base, and the dividend yield of just under 1 percent is immaterial to the investment case. The market is clearly pricing in execution risk and a possible shift in the pace of the munitions boom.
All eyes now turn to the second-quarter results, due on August 6. That report will reveal the exact hit to order intake and revenue from the frigate’s demise, and will test whether the Bank of America’s downbeat 2030 scenario is too cautious or merely a realistic reflection of the challenges ahead. With the stock trading near its lows, the earnings call will be the next crucial checkpoint for a company that is simultaneously retooling for drones and space while trying to absorb a major programme loss.
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Rheinmetall Stock: New Analysis - 18 July
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