BlackRock Moves In as Hensoldt’s Radar Order Fades: The Defense Stock’s €32 Split

Germany's frigate program pivot cancels €200M Hensoldt radar order, but company reaffirms guidance. Analysts split (Jefferies Buy €94 vs mwb Sell €62) while BlackRock raises stake to near 5%.

The decision by Germany’s budget committee to scrap the F126 frigate program in favor of four MEKO A-200-DEU vessels has erased a specific €200 million radar order for Hensoldt, yet the company insists its guidance remains intact. The TRS-4D radar that would have equipped the F126 frigates belongs to a platform-independent product family, management said, insulating near-term earnings from the procurement pivot. Still, the cancellation has sharpened the divide on Wall Street: Jefferies lifted its price target to €94 with a Buy rating on July 10, while mwb research downgraded the stock to Sell with a target of just €62, citing an excessive valuation at roughly 18 times expected 2026 operating profit and the risk of further marine-contract losses.

That €32 gap between analyst targets underscores the uncertainty hanging over Hensoldt’s naval pipeline. The broader defence sector provided some counterweight the same week: Thyssenkrupp Marine Systems (TKMS) flagged a potential €8 billion Indian submarine order by late 2026, and its existing backlog already stands at €20.6 billion, ten times its annual revenue. Rheinmetall, meanwhile, drew a €100 million call-off under the Bundeswehr’s D-LBO programme, though Bank of America simultaneously slashed its price target on the stock from €1,770 to €1,300 after the F126 loss sent the frigate contract to TKMS. Amid this mixed backdrop, Hensoldt’s shares added roughly 4% on the Monday following the budget decision, ending at €75.78, before easing 0.42% in the subsequent session.

Institutional interest, however, tells a different story. BlackRock has incrementally built its direct stake in the sensor and electronics specialist from 2.81% to 3.17% in recent weeks, according to a voting-rights disclosure dated July 17. Including financial instruments, the asset manager’s total position reaches 4.997%, just below the mandatory 5% reporting threshold. The steady accumulation signals conviction from one of the world’s largest investors even as the stock trades 34% below its 52-week high of €115.10, set on October 3 last year. With a market capitalisation of €8.77 billion, Hensoldt remains a heavyweight in the German defence segment, but the gap to that record level has tempered the valuation exuberance of earlier months.

Chart watchers see little technical resolution yet. The stock hovers within 1% of its 50-day moving average of €76.54, and it sits 4.07% below the 200-day average. The Monday rally lifted the price after a 4.99% gain over the prior 30 days, but analysts caution that a sustained trend reversal would require more than a single session’s bounce. The proximity to the 50-day line does, however, put a break above that threshold within reach if upcoming catalysts prove positive.

The next major test arrives on July 31, when Hensoldt publishes its first-half results for the period ending June 30. Management raised its guidance for adjusted free cash flow at the start of June, and shareholders at the annual general meeting in late May approved the dividend for fiscal 2025. The half-year report will show whether the company can maintain that trajectory despite the F126 setback. For now, the interplay between BlackRock’s quiet accumulation, the lost radar contract, and a defence sector that is pouring money into electronics and air defence rather than hulls leaves Hensoldt’s narrative hanging on execution — and on which analyst turns out to have read the procurement tea leaves more accurately.