Renk's Service Revenue Streak: The Hidden Driver Behind the Stock's 18% Rally from the Lows
26.05.2026 - 17:33:09 | boerse-global.de
Renk Group may be best known for the heavy-duty gearboxes it builds for tanks and naval vessels, but the real money, according to AllianceBernstein, is in what happens decades after the sale. The asset manager has flagged the defence supplier as one of the most compelling picks in the European defence space — not because of swelling order books, but because the market has consistently overlooked the value of its aftermarket business. Replacement parts and maintenance contracts carry fatter margins and are far less cyclical than new-equipment sales, yet analysts argue this recurring revenue stream is barely priced into the stock.
The shares have been proving the point. After plumbing a 52-week low of €43.99 on 13 May, Renk has staged a steady recovery. By the following Monday the stock had climbed to €50.38, a gain of around 10% in a week, and it has since extended that move to €51.85 — nearly 18% above the trough. The catalyst came on 16 May, when KNDS, the Franco-German armoured-vehicle builder, offloaded roughly 5.8 million shares via an accelerated bookbuild at €45.10 each. The block trade raised €262 million and whittled KNDS’s holding to about 10%, removing a major overhang that had weighed on the stock for months.
The recovery has been underpinned by first-quarter numbers that show the operational turnaround is gaining traction. Revenue rose 4% year on year to €283.6 million, while earnings per share jumped from one cent to €0.15. Adjusted EBIT climbed 10.4% to €42.4 million, pushing the margin to 15%, and order intake surged 6.1% to a record €582 million for the period. The backlog now stands at €6.9 billion, with more than 90% of the full-year revenue target — above €1.5 billion — already covered by contracts and framework agreements. Management is guiding for an adjusted EBIT of between €255 million and €285 million for the full year, and has set a longer-term ambition of €3.2 billion in revenue by 2030, with an operating margin above 20%.
Should investors sell immediately? Or is it worth buying Renk?
The broader market has provided a tailwind. Hopes of a diplomatic resolution to the US-Iran standoff sent the MDAX up 2.18% on Monday, with defence and industrial names leading the charge — TKMS jumped more than 5%. Yet Renk still sits 43% below its 52-week high of €88.73, and technical indicators suggest the recent rally may be stretched: the relative strength index stands at 78, well into overbought territory. The 200-day moving average at €59.42 also represents a formidable resistance level.
Shareholders have a vote on the dividend at the annual general meeting on 10 June, where a payout of €0.58 per share — 38% above last year’s — is on the table. Analysts are already looking further ahead, forecasting a dividend of €0.723 per share for 2026. The next major inflection point comes on 6 August, when Renk reports second-quarter results. That print will show whether the record order book is translating into faster revenue growth — and whether the market is finally giving the service business the credit it deserves.
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