At Renk, a Record Order Intake Can’t Stop the Stock Slump – Management Goes on the Offensive

Despite record quarterly orders and €6.9 billion backlog, Renk shares hit 52-week low; analysts see overreaction, CEO hits roadshow to bridge valuation gap.

The dissonance between Renk’s operational momentum and its sinking share price has rarely been starker. The Augsburg-based defence supplier just logged the best quarterly order intake in its history, yet its stock closed Friday at a 52-week low of €43.91 — a level that chops the market value in half from last October’s peak. Over the past month alone, the shares have lost roughly 17%, dragged down by sector-wide jitters after rival Rheinmetall struck a cautious note.

Four-Figure Backlog Meets a Sub-€44 Price Tag

Renk’s first-quarter performance paints a completely different picture from the bearish price action. The company booked a record €582 million in new orders, swelling the total order backlog to €6.9 billion. Profitability is also firming: the adjusted EBIT margin improved to 15%, and management has already secured more than 90% of the planned full-year revenue in contracts.

That operational heft has not been lost on analysts. MWB Research upgraded the stock to “Buy” with a €53 price target, calling the recent sell-off overdone. Warburg Research kept its own “Buy” rating and a €63 target. BlackRock appears equally convinced: the world’s largest asset manager lifted its voting rights stake to 4.44% from 3.63%, a move timed almost exactly to the stock’s weakest point.

Roadshows and a €325 Million Factory Bet

To bridge the gap between a record order book and a tumbling share price, management is hitting the road. In the coming days, executives will present the growth strategy at investor conferences in New York and Frankfurt, aiming to explain why the share price no longer reflects the underlying business.

Meanwhile, the company is putting hard cash behind its expansion plans. Renk will invest up to €325 million in its German factories by 2028, channelling the money into three areas: digitalisation — including “drive-by-wire” technology for autonomous systems — capacity expansion to serve the Bundeswehr and NATO, and the development of hybrid drivetrains for combat vehicles.

New Products and a June Dividend Vote

Beyond the factory floor, Renk is also pushing into new product segments. The ESM 280 gearbox, designed for armoured wheeled vehicles, will be unveiled at the Eurosatory trade fair in Paris in mid-June, alongside a heavy unmanned ground vehicle developed with partner Patria. CEO Alexander Sagel’s contract was extended through spring 2032, signalling board confidence in the current leadership.

Shareholders will have their say on June 10 at the virtual annual general meeting. The agenda includes a proposed dividend of €0.58 per share. With the stock at a year low, the yield on that payout will be higher than when the board first proposed it — another twist in the widening gap between Renk’s financial reality and its stock market reception. For now, the company sticks to its full-year guidance: revenue above €1.5 billion and adjusted operating profit between €255 million and €285 million.