Rheinmetall's CEO Puts His Money Where His Mouth Is, But a €73 Billion Backlog Can't Silence the Political Questions
01.07.2026 - 03:24:15 | boerse-global.de
The defence contractor's stock clawed back above the psychologically critical €1,000 mark on Tuesday, gaining 2.79% to close at €1,002.00. The catalyst was a new order for 155-millimetre artillery shells destined for Ukraine, a deal in the high double-digit millions that Rheinmetall will book in the current second quarter. Delivery of a low five-figure quantity of the long-range munitions is scheduled for early 2027, with production handled by Spanish subsidiary Expal Munitions — an acquisition that is increasingly paying dividends.
Another signal of confidence came from the top floor. Chief executive Armin Papperger snapped up just over €3 million worth of his own company's shares on 25 June, at an average entry price of €954.62. The purchase comes after a brutal slide: the stock has shed 42% over the past twelve months and is still trading nearly 50% below its 52-week high of €1,995, despite a roughly 11% bounce from the trough of €902.50. Analysts at DZ Bank, who reaffirmed their buy rating and €1,705 price target — implying roughly 70% upside — will be watching to see if the insider buying marks a floor.
Behind the daily price swings lies a deeper tension. Rheinmetall's order backlog stands at a record €73 billion, and this year's revenue growth is forecast at up to 45%. Yet the market has turned sceptical, punishing the stock for what Papperger himself identified as the central bottleneck: not production capacity, but the political will to fund orders. "The limiting factor for Ukraine aid is financing, not factories," he said in February 2026. The lost F126 frigate project showed how quickly a single contract setback can rattle the shares, and the stock's annualised volatility of nearly 66% underscores the market's jitters.
Should investors sell immediately? Or is it worth buying Rheinmetall?
The bull case nevertheless retains strong foundations. Rheinmetall expects potential international order intake of €80 billion by the end of 2026, and plans to scale 155mm shell output to 1.5 million rounds per year by 2030. The planned joint venture with Destinus, Rheinmetall Destinus Strike Systems, is slated for formation in the second half of 2026 and would produce advanced missile systems for European and allied customers. The Eurosatory 2026 exhibition has already publicised programme priorities, suggesting both partners are serious about the timeline. Meanwhile, the relative strength index at 33.8 signals an oversold condition.
But the bears point to structural vulnerabilities that no factory expansion can fix. Rheinmetall is a political company first and an industrial one second. Every major contract requires government decisions, parliamentary approvals and NATO co-ordination. The stock now trades roughly 18% below its 50-day moving average and more than 35% below the 200-day average — a sustained downtrend, not a mere blip. The Main Ground Combat System, in which Rheinmetall is involved, is seen as vulnerable to budget compromises, and the Destinus joint venture still requires regulatory clearance, with no guarantee of approval.
Two catalysts in the second half of 2026 could tip the balance. The first is the Q2 earnings report, expected in August, which will reveal whether the order book has held steady after the frigate loss and whether the company can confirm its ambitious full-year guidance. The second is the go-ahead for the Destinus JV. If approval comes quickly, it would provide concrete evidence that Rheinmetall is building missile production capacity, not just talking about it.
For now, the market is caught between a cheap valuation and a credibility gap. The stock's year-to-date loss still stands at 37.43%, and the 52-week high of €1,995 remains a distant memory. If political conditions stabilise and financing commitments materialise, the post-sell-off valuation argues for a recovery. If delays or funding shortfalls persist, cheap alone will not be enough. The €1,000 support level is being tested — and so is the question of whether governments will finally turn promises into payments.
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