Oddo BHF Flags Rheinmetall as a 'Growth at a Discount' Bet After a 40% Slide From the Peak
Published on 06/22/2026 at 11:02 | Redaktion boerse-global.de
The defence stock that once led the DAX’s rally is now getting a second look from analysts who see a buying opportunity in the wreckage. Oddo BHF upgraded Rheinmetall from "Neutral" to "Outperform" on Friday, arguing that a near 20% decline over the past three months has pushed the shares to an unjustified discount relative to European defence peers. Analyst Yan Derocles set a new price target of €1,670, still well above the stock’s current level around €1,210, describing the setup as "growth at a discount price."
The call comes as Rheinmetall trades roughly 40% below its 52-week high of €1,995. Since the start of the year, the shares have lost about 24%, a slide that Derocles attributes to overblown investor concerns around order conversion and product mix. He calculates that Rheinmetall now commands a valuation discount of more than 20% versus the wider European defence sector. "This is exactly the kind of entry point we were waiting for," one London-based fund manager said, echoing the upgrade.
Technical Resistance Looms as Erholung Begins
On the very day of the upgrade, Rheinmetall shares climbed 2.2% to €1,200.20, making it one of the top gainers in a DAX session marked by Hexensabbat — the simultaneous expiry of options and futures on indices and single stocks. That technical event amplified moves across the board, with defence and pharma names leading while autos and cyclical consumer stocks struggled. Rheinmetall’s recovery followed a volatile stretch in early June that had spooked short-term holders.
Should investors sell immediately? Or is it worth buying Rheinmetall?
Yet the path ahead is not without speed bumps. The 50-day moving average sits at €1,278, roughly 5% above Friday’s close, and until the stock reclaims that level the short-term downtrend remains intact. Competitors such as RENK and HENSOLDT have shown more stability in recent sessions — RENK rose 2.43% on the day, HENSOLDT 1.23% — but Oddo BHF believes that very underperformance is the argument for a contrarian position.
Political Backdrop Strengthens the Bull Case
Structural catalysts continue to underpin the long-term demand story. On Wednesday, the German parliament’s budget committee is expected to approve a direct state stake in tank manufacturer KNDS, with Berlin targeting a 40% holding in the parent company to match France’s voting rights and secure a blocking minority. The move underscores the government’s commitment to domestic armour production, a trend that directly benefits Rheinmetall as a key supplier and rival.
Meanwhile, Defence Minister Boris Pistorius visited the NATO exercise "Freedom Shield 2026" in Lithuania, where around 2,900 soldiers and 800 vehicles are practising the defence of the Suwalki Gap. The Panzerbrigade 45 is slated to expand to 4,800 troops by 2027 — a multi-year requirement that keeps Rheinmetall’s order pipeline busy. In May, the company secured a framework agreement worth over €1 billion for transport vehicles, reinforcing the message that military demand remains at record levels.
A Consolidation Phase That Rewards Patience
For all the near-term noise, the operational fundamentals have not cracked. Rheinmetall’s order backlog continues to swell, and the geopolitical environment shows no sign of easing. Institutional investors have kept the name on their radar even as the share price churned. Derocles’s upgrade reflects a conviction that the current consolidation is exactly the kind of pause that separates transient pain from structural opportunity — provided investors can look past the 50-day moving average.
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