Hensoldt Loses Favourite Status at Jefferies as Bundestag Opens New Frigate Door
Published on 07/12/2026 at 13:07 | Redaktion boerse-global.de
Hensoldt received a mixed signal from one of its long-time backers on Thursday: Jefferies raised the price target to €94 but quietly moved the German defence electronics group off its top-pick list. The new favourite, Italy’s Leonardo, now takes that spot — a shift that underscores the cautious tone creeping into a sector known for sky-high valuations.
The downgrade in status, if not in rating, came as analyst Chloe Lemarie maintained buy recommendations on Hensoldt, Rheinmetall and RENK. The price target lift from €90 to €94 reflects a methodological change: Jefferies has switched to a sum-of-the-parts valuation for 2028 and is tilting its sector focus from land-based systems toward defence electronics and air defence. Leonardo wins out thanks to its electronics-heavy profile, which offers higher software and data content — sensors, communications interfaces, upgradeability — that can adapt faster to new threat environments than pure platform components.
Bundestag’s €9.5bn Frigate Approval Offers Glimmer of Opportunity
The news from Berlin arrived just days later — and could prove crucial for Hensoldt’s medium-term outlook. On 8 July 2026, the Bundestag’s budget committee approved 16 procurement projects worth over €9.5bn, headlined by four MEKO A-200 DEU anti-submarine frigates plus a high-energy laser weapon system for the navy. The committee placed firm orders for four vessels and secured an option on four more, with the firm batch carrying a price tag of roughly €6.3bn and the option adding €5.3bn. Delivery of the first frigate is slated for 2029.
The decision replaces the ill-fated F126 programme, which the defence ministry scrapped over delays, cost overruns and unmanageable risks. That cancellation had been a direct blow to Hensoldt, stripping it of a €200m order to supply the TRS-4D naval surveillance radar. More than a third of that contract value had already been booked as revenue, and the unit’s remaining contribution for 2026 was only in the low double-digit millions, so Hensoldt did not change its full-year guidance. Still, the loss stung.
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With the TKMS shipbuilding group now set to construct the new frigates, Hensoldt’s sensor systems, already deployed on other naval vessels, could find their way into the MEKO A-200 design. The question is to what extent and on what terms — no contract has been announced yet.
Stock Stuck in a Range, Technicals Still Weak
None of this moved the share price meaningfully. Hensoldt closed Friday at €74.66, up 0.86% on the day, but the weekly performance was a loss of 0.74%. Over 30 days the stock shed 4.48%. The chart paints a picture of a stock struggling to break free: it sits 2.89% below the 50-day moving average of €76.88 and 6.61% below the 200-day line at €79.95. The 52-week high of €115.10, reached on 3 October 2025, is now 35.13% out of reach. Since the year’s low of €63.12 on 26 June 2026, the recovery amounts to 18.28%, but on a 12-month basis the shares are still down 28.42%. The relative strength index reads 49.8 — neutral — while the annualised volatility of 56.38% suggests markets are still on edge.
Valuation ratios underscore why Jefferies is looking elsewhere. Hensoldt trades on a price-to-earnings multiple of roughly 96, compared with Rheinmetall’s 101 and RENK’s 53 — all well above the broader market. Market capitalisation stands at about €9.1bn, versus Rheinmetall’s €49.4bn and RENK’s €4.6bn.
Jefferies’ new €94 target is close to the analyst consensus of €91.67 for Hensoldt and within a reasonable band for RENK (target €60 vs. consensus €68.00). For Rheinmetall, however, the bank’s €1,300 target sits well below the consensus of €1,705.56, indicating a more cautious stance on that name.
Half-Year Report Looms as Next Catalyst
The next major test for Hensoldt arrives on 31 July 2026 with the half-year financial report. Investors will want to see how much the original F126 contract loss actually hit margins and revenues, whether the new frigate procurement opens genuine radar opportunities, and whether the upgraded free cash flow guidance — boosted by higher customer prepayments and faster procurement cycles in Germany — holds up.
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Underlying operations remain sound: order intake doubled to nearly €1.5bn in the first quarter, and the order backlog hit a record €9.8bn. The company is targeting full-year revenue of about €2.75bn with an adjusted EBITDA margin between 18.5% and 19.0%. But the stock has yet to reflect that strength, caught between its yearly low near €63 and the 50-day average around €77.
The tug-of-war between bullish analysis — Jefferies still with a buy — and skeptical voices warning of a rally without a solid contract base will be settled only by hard numbers. Until then, Hensoldt remains a high-beta bet on German defence policy, one that has lost its top-pick status while waiting for a firm radar contract to give the share price a real lift.
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