Rheinmetall's 2028 Order-Book Math Is Spooking Investors, Even as the Bundeswehr Adds €500 Million in New Business
Published on 08/20/2026 at 03:13 | Redaktion boerse-global.de
The arithmetic of defense contracting can be unforgiving, and Rheinmetall shareholders felt that sting on Wednesday. Shares in the Düsseldorf-based arms maker slid to the bottom of the DAX, closing at €1,177.80 after a 2.8 percent decline, as a fresh "Sell" call from mwb research reignited concerns about a potential order gap beginning in 2028.
The Munich-based research house ran the numbers on Rheinmetall's €80.5 billion order backlog, as reported at the half-year mark at the end of June, and found a troubling mismatch. Only around €2.4 billion of that backlog is expected to convert into revenue during 2028 — a figure that stands in stark contrast to mwb's own 2028 revenue forecast of €22.63 billion and the market consensus of €25.4 billion. To bridge that chasm, the analysts calculate Rheinmetall would need to secure roughly €65 billion in additional orders by 2028. mwb research maintains its "Sell" rating with a price target of €1,050, arguing that current market expectations are simply too ambitious.
The warning landed on a stock already nursing significant wounds. At Wednesday's close, Rheinmetall sits 41 percent below its 52-week high of €2,007.00, reached in early October of last year. The twelve-month decline stands at 24 percent, with the year-to-date loss also at 24 percent. The monthly picture tells a different story, however: the shares have clawed back 19 percent over the past month, reflecting a vigorous recovery rally before this week's setback.
New Orders Keep Flowing Despite the Skepticism
The bearish thesis collides with a steady stream of operational wins. On Monday, the Federal Office of Bundeswehr Equipment, Information Technology and In-Service Support (BAAINBw) activated an additional 149 mobile rescue stations from a framework agreement signed in 2024. The order is valued at over €500 million gross, bringing the total project volume to 165 systems worth more than €600 million.
The company is also making quiet technological strides. Together with Hensoldt, Rheinmetall demonstrated the successful integration of the passive Twinvis radar into the Skymaster command-and-weapons engagement system during the "Timber Express 2026" air force exercise. The drill showcased NATO-compliant networking for controlling Skynex air-defense batteries — a component in the emerging European air-defense architecture.
Should investors sell immediately? Or is it worth buying Rheinmetall?
Analyst Divergence Widens
The sell-side remains split on Rheinmetall's trajectory. RBC initiated coverage on August 13 with an "Outperform" rating and a price target of €1,600, citing the company's strong positioning in the European rearmament wave and expected EBITA growth of 35 percent annually through 2030.
JPMorgan's David Perry struck a more cautious tone on August 17, holding a "Neutral" stance with a €1,350 target. Perry acknowledged the strong second-quarter results but flagged growing medium-term uncertainties — language that aligns closely with the order-gap debate now dominating the conversation.
The loss of the F126 frigate contract to competitor ThyssenKrupp Marine Systems, which triggered a downgrade of the company's annual guidance back in August, adds further weight to concerns about future order intake.
The Bull Case: Defense Spending Trajectories
Countering the skepticism is a geopolitical backdrop that many investors read as a structural tailwind for defense stocks. NATO members have agreed on a target of 5 percent of GDP for defense spending by 2035, with 3.5 percentage points allocated to the core defense budget. Germany plans defense expenditures of €108.2 billion in 2026, rising to €152 billion by 2029. Globally, military spending has reached $2.9 trillion — the eleventh consecutive record year.
Whether those long-term budget commitments translate into actual orders for Rheinmetall at the pace the market expects remains the pivotal question. mwb research doubts the order intake can keep up with consensus revenue projections. The company's production timelines in the vehicle segment mean newly signed contracts won't fully hit the revenue line until after 2028, creating the temporal lag at the heart of the concern.
A potential catalyst looms in December, when decisions on further budget allocations and major contracts are expected — a development that could set the next course for the stock, provided the production-capacity worries can be addressed by then. For now, the market's verdict is clear: the order book may be full, but the pipeline beyond it is the metric that matters.
Ad
Rheinmetall Stock: New Analysis - 20 August
Fresh Rheinmetall information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
