Renk Stock Surges on Rheinmetall’s €1 Billion Bundeswehr Order as Record Backlog Supports Outlook

Renk, supplier of driveline components for Rheinmetall, jumped 5.9% after a €1 billion Bundeswehr order. Weekly gain 14%, record order backlog €6.9B, analyst target implies 20% upside.

The gearbox maker wasn’t the headline-grabber, but Renk shares topped the MDAX on Thursday after the Bundeswehr triggered a €1 billion order for more than 2,000 military transport vehicles from Rheinmetall. Renk supplies the driveline components and transmissions for a large part of those vehicle types, giving it a direct line to the spending spree. The stock climbed 5.9% in XETRA trading to close at €55.78, after touching an intraday high of €56.63. Volume hit nearly 730,000 shares, well above average.

The weekly performance is even more striking: Renk has added almost 14% in seven days, lifting the price comfortably above its 50-day moving average of €51.68. That stark outperformance comes without any company-specific press release — the catalyst was entirely external. Alongside Renk, other defense names also rallied: TKMS jumped 6.4% and Hensoldt added 2.1%, underlining the sector-wide momentum. Analysts view the contract call-off as evidence of strong planning security across the German defense industry, particularly for suppliers like Renk that have already locked in over 90% of planned 2026 revenue.

The operational foundation for the run-up is solid. In the first quarter of 2026, Renk reported record order intake of €582.3 million — its best ever start to a year — while the total order backlog swelled to €6.9 billion. Revenue rose 4.0% to €283.6 million, adjusted EBIT improved to €42.4 million, and the adjusted EBIT margin widened to 15.0% from 14.1% a year earlier. Earnings per share jumped from €0.01 to €0.15. The Vehicle Mobility Solutions segment, which covers military propulsion systems, was the standout: order intake leapt 20.5% to €478.4 million, revenue climbed 11.2% to €191.5 million, and segment adjusted EBIT advanced 22.3% to €35.0 million.

For the full year, management reaffirmed its guidance of revenue above €1.5 billion and adjusted EBIT in a range of €255 million to €285 million. Despite the strong headline numbers, the relative strength index has climbed to 73.4, pushing into overbought territory. The stock also remains roughly 37% below its 52-week high of €88.73 from October 2025 — a reminder of how far it still has to travel to reclaim those levels.

Analyst targets, however, paint a more optimistic picture. The consensus price objective stands at €66.71, implying roughly 20% upside from current levels. Banks including Jefferies, DZ Bank and Deutsche Bank maintain positive ratings. Ahead of the annual general meeting on June 10, 2026 — which will be held virtually — investors are expecting a dividend increase to €0.723 per share, up from €0.58 last year. Broader geopolitical tensions, including unrest in the Strait of Hormuz, continue to underpin demand for defense equipment globally. The German financial watchdog BaFin has also stepped up insider-trading surveillance in the sector, a sign of the industry’s elevated profile on the equity market.