Rheinmetall and Lockheed Target European Missile Gap as Investors Dig In for the Long Haul
Published on 07/08/2026 at 05:12 | Redaktion boerse-global.de
A symbolic handshake at this week’s NATO summit in Ankara is laying the groundwork for the first ATACMS short-range missile factory outside the United States — but the stock market is not yet buying the narrative. Rheinmetall and Lockheed Martin signed a memorandum of understanding on July 7, 2026, to establish a joint venture in Unterlüß, Lower Saxony, that will produce missile motors and other components. The German defence group’s shares closed Tuesday at €1,116.40, little changed on the day and still nursing a year-to-date loss of 30.29%.
The venture, if it wins final regulatory approvals from Washington and Berlin, would plug a specific transatlantic gap. Lockheed Martin has scaled back ATACMS production at its Camden, Arkansas, plant in favour of the newer Precision Strike Missile, yet European and Ukrainian demand for the older system remains robust at an estimated 600–800 missiles annually. Lockheed’s maximum capacity tops out at 500 units, leaving a chasm that the Unterlüß site is designed to fill. Production is not expected to begin before 2027, meaning any revenue contribution remains several quarters away.
Rheinmetall chief executive Armin Papperger framed the deal as a step toward European defence independence. “Together with our friends at Lockheed Martin, we are now building the industrial base in Germany for modern defence systems that are in strong demand among European armed forces,” he said. The partnership is not new: the two companies signed an initial rocket agreement in 2024, expanded it to a “centre of competence” in April 2025, and entered concrete talks about ATACMS and Hellfire missiles for Unterlüß last August. The site already employs roughly 4,000 people and hosts a new artillery munitions plant, with a rocket-motor factory nearing completion.
Should investors sell immediately? Or is it worth buying Rheinmetall?
Despite the strategic logic, the stock remains deep in bear territory. From its 52-week high of €1,995.00 set in September 2025, the shares have lost 44.04%. Over twelve months the decline is 38.83%, and the 30-day annualised volatility sits at a jarring 70.15%. The 50-day moving average of €1,188.23 lies 6.05% above the current price, while the 200-day average at €1,531.08 stands a full 27.08% higher — a gap that underscores how entrenched the downtrend has become.
Some technical signs offer modest encouragement. The relative strength index at 48.8 has edged back into neutral territory after the heavy selling of recent months, and the stock has rallied 5.84% over the past seven days, suggesting that support may be forming near the 52-week low of €902.50. Yet the overriding sentiment among traders is caution. The MoU is not a binding contract: formal establishment of the joint venture is expected in the second half of 2026 or early 2027, and any delay in the approval process — particularly from US export-control authorities — could renew selling pressure.
For now, Rheinmetall’s immediate fate hinges on whether it can close the gap to the 50-day moving average. A decisive break above that level would open the door toward the 200-day line and signal that the worst of the rout may be over. Until then, the stock is likely to swing in a volatile sideways pattern. The long-term thesis — that Rheinmetall is becoming the anchor of European missile production — will take years to prove out. Investors willing to stomach the 70% annualised volatility are betting that the 2027 production start will transform the order book. The rest are waiting for a catalyst that hits the income statement, not just the headlines.
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