Rheinmetall's Record Backlog Puts a Single Cancelled Frigate in the Rear-View Mirror
Published on 08/12/2026 at 14:41 | Redaktion boerse-global.de
The arithmetic at Rheinmetall is getting harder to argue with. The Düsseldorf-based defence group closed the second quarter with an order book of €80.4 billion — a record — while revenue climbed to €3.289 billion and operating profit reached €562 million. Those figures, confirmed by Reuters on Wednesday, arrived just days after the company had slashed its full-year sales guidance following Berlin's decision to scrap the F126 frigate programme.
The market's verdict was swift. Shares jumped 3.20 percent in XETRA trading on Wednesday to €1,180.20, building on a 30-day run that has now stretched to roughly 20 percent. Even so, the stock remains more than 41 percent below its 52-week peak of €2,007.00, hit back in October.
One Contract, Two Headlines
The frigate cancellation has created an odd split-screen moment for the company. On the one hand, Rheinmetall had to walk back its revenue outlook for the current year, now guiding to a range of €13.7 billion to €14.2 billion — a €300 million trim from the previous target. On the other, the underlying demand picture has rarely looked healthier.
That tension was on full display in the company's preliminary second-quarter release. Management pointed to persistent strength in the military segment, even as inventory build-up in the United States and a softer cashflow position weighed on the overall picture. The US-related drag, tied in part to the ramp-up of ATACMS ammunition production and the replenishment of American stockpiles, has drawn attention to how long production scale-up will take.
Should investors sell immediately? Or is it worth buying Rheinmetall?
New Orders Keep the Pipeline Full
While the frigate setback dominated the news cycle, the order flow tells a different story. Rheinmetall has signed a contract with the British Army for wheeled howitzer weapon systems, and — together with partner KNDS — secured an order from Germany and the Netherlands for Boxer armoured vehicles. The breadth of that demand, spanning artillery and land systems, underscores how deeply European governments are now committed to rebuilding their military capabilities.
Even the geopolitical noise has so far proven manageable. When Beijing placed Rheinmetall on an export control list at the end of July, alongside 13 other European companies, the company's own assessment was that the impact would be limited. Given that the order book is overwhelmingly concentrated in Europe and the US, that assessment looks reasonable.
Analysts See Upside Beyond the Current Price
The analyst community has largely shrugged off the guidance cut. Warburg Research reaffirmed its Buy rating on Monday with a price target of €1,500, while RBC Capital Markets initiated coverage on Tuesday with an Outperform rating and a €1,600 target. Both see meaningful headroom above Wednesday's trading level.
There is, however, a secondary detail that has added an unusual layer to the Rheinmetall story: media reports that the company's chief executive is now under personal protection. It is a reminder that the defence sector's heightened profile carries consequences that extend well beyond quarterly earnings sheets.
For investors, the calculus is straightforward. A record backlog and a steady drumbeat of new contracts are competing against a single, albeit politically significant, cancellation. Wednesday's share price action suggests the market is currently weighting the momentum of the core business more heavily than the frigate disappointment. The question is whether that balance holds as the year progresses.
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