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Rheinmetall shares at record high: arms boom due to geopolitical tensions!
Rheinmetall benefits from geopolitical tensions and strategic investments. Share price rises, analysts recommend buying.
Rheinmetall shares at record high: arms boom due to geopolitical tensions!
Rheinmetall AG, a leading company in the defense sector, is currently experiencing a significant upswing, which is largely supported by geopolitical developments and strategic investments in production capacities. How it-boltwise reported, the demand for defense stocks has increased significantly, which has a positive effect on the share price. Analysts at Jefferies and Bank of America see Rheinmetall as the main beneficiary of rising defense spending in Europe and Germany.
Recently, the target price for Rheinmetall shares was raised by the private bank Berenberg from 1,630 euros to 2,040 euros. This reflects increased investor interest. The share itself has reached an all-time high of 1,753 euros, while the company's order backlog is at a record level of 62.6 billion euros. Other defense stocks, such as Renk and Hensoldt, are also recording price gains, underlining the general positivity in the sector.
Production goals and market position
In order to meet increasing demand, Rheinmetall plans to increase production capacity for artillery ammunition to 1.1 million pieces per year by 2027. Some of these investments take place before official government orders, which gives the company a decisive competitive advantage. Loud Stocks.Guide The company generates two thirds of its business in Europe, with Germany being the largest single market.
Rheinmetall's business model includes the development, production and distribution of military and civil technologies. The company's main segments are:
| segment | Sales (in billion euros) | Sales share |
|---|---|---|
| Vehicle Systems | 3.8 | 39% |
| Weapons and Ammunition | 2.8 | |
| Power Systems | 21% | |
| Electronic Solutions | 1.7 | 18% |
Sales in the Vehicle Systems segment increased by 45% in 2024, while the Weapon and Ammunition segment even increased by almost 60%. The defense market in particular has proven to be highly dependent on political decisions and security policy frameworks. Analysts forecast Rheinmetall will exceed expectations throughout the year, with double-digit growth rates of 25-30% expected in 2025.
Market analysis and outlook
In the first quarter of 2025, Rheinmetall achieved sales of 2.3 billion euros, which corresponds to an increase of 46% compared to the previous year. Furthermore, orders received increased by 181%, an index that underlines the increasing demand. Analysts see EBITDA on a promising upward trend, which could grow from 1.8 billion euros in 2024 to almost 7 billion euros by 2029.
With a price-to-earnings ratio (P/E) of 103 and an EV/free cash flow (EV/FCF) of 80, the stock is considered expensive. Nevertheless, 89% of analysts are optimistic and give a buy recommendation. The average price target is currently 1,704 euros, which reflects the high market expectations.
Overall, Rheinmetall AG shows that it is well positioned to benefit from current developments in the defense sector and to establish itself as one of the most important players in the market.