Leonardo Draws Contrasting Signals as Order Book Grows and Short Bets Fade
Published on 07/17/2026 at 06:21 | Redaktion boerse-global.de
Leonardo is sending the market two very different messages at once: operational demand remains strong, while sentiment around the shares is still hesitant. The clearest evidence of that split came this week from Leonardo DRS Inc., the US subsidiary of the Italian defence and security group, which secured an order for more than 50,000 Tenum Orbit thermal-imaging cameras.
The customer was not named, but the scale of the contract is notable. The cameras are mainly used in unmanned systems, though other fast-growing defence platforms also rely on the technology. Leonardo DRS said the deal underlined customer confidence in its manufacturing base and its ability to deliver advanced sensor technology in large volumes.
That backdrop sits awkwardly beside the stock’s recent performance. Leonardo closed on Thursday at 49,38 Euro in one report and 49,45 Euro in another, both pointing to a share price hovering just below the EUR 50 mark. Over the past seven trading days, the stock fell 5,21 percent and 5,08 percent respectively, while over the past month short interest in the uncollateralised ADRs of the defence group (FINMY) dropped by 44,5 percent.
The share is still trading about 25 percent below its 52-week high of 66,24 Euro, reached in mid-March. It also sits 7,50 percent under its 200-day average of 53,45 Euro. The 14-day RSI stands at 43,4, which leaves it in neither oversold nor overbought territory. Since the start of the year, the stock is down 3,56 percent, though it remains up 4,28 percent over 12 months.
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Even so, the order pipeline points in the other direction. Leonardo entered 2026 with solid momentum, lifting first-quarter orders by 31 percent year on year to more than 9 billion Euro. The total backlog now stands at around 56,8 billion Euro, equal to more than two years of revenue. That gives the group a substantial base for its “Readiness 2030” industrial programme.
Wall Street, for its part, has not turned defensive. The consensus view remains “Moderate Buy”, and Jefferies and Citigroup have both raised their targets in the past 48 hours. The market’s caution therefore appears tied less to the business itself than to the gap between strong operational data and a share price that continues to lag.
Saudi Arabia has also emerged as a key focal point. In mid-July, several reports said talks with the sovereign wealth fund PIF on a joint global aerostructures venture were largely complete. For Leonardo, that could be important: the aerostructures division has been weighed down by structural issues linked to the slowdown in civil aviation production.
A possible Saudi deal could include a new manufacturing facility for civil aviation in the kingdom. It could also open the door to Saudi participation in the next-generation fighter programme Leonardo is developing with British and Japanese partners.
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Broader defence spending trends in Europe are adding another layer of support. Leonardo is viewed as a leading player in drone defence and night-vision equipment, two markets that are both expected to grow at more than 8 percent a year through 2033. Investors are also watching “Project Bromo”, the proposed 6,5 billion Euro combination of the space businesses of Airbus, Thales and Leonardo. If it goes ahead, Leonardo would hold a planned 32,5 percent stake, shifting the company from supplier to co-owner of a major European space group.
The next major checkpoint comes on 30 July, when Leonardo reports half-year numbers. It will be the first full quarter to include the Iveco-Defence business in consolidation, and the figures should offer a clearer read on margins as well as the state of the PIF talks.
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