Rheinmetall’s Artillery Output Now Exceeds All of America, Yet the Stock Keeps Sinking

Rheinmetall's output and orders soar, but shares near 52-week low; analysts see upside with price targets above €2,000.

The disconnect between Rheinmetall’s operational surge and its stock market performance has rarely been starker. The German defence group is churning out more artillery shells than the entire United States, has just secured a €4.2 billion order for 200 Puma infantry fighting vehicles, and is targeting a 40 percent revenue jump this year. Yet its share price continues to languish near a 52-week low.

On Tuesday, the stock touched €1,329.60, its lowest point in 12 months. Since the start of the year, the shares have shed nearly 17 percent of their value. The gap to the 200-day moving average has widened to roughly 20 percent, a technical signal that often points to sustained bearish sentiment.

A production ramp-up like no other

Rheinmetall has transformed its manufacturing capacity at a pace that has surprised even seasoned industry watchers. Annual output of artillery ammunition has exploded from 70,000 units to around 1.1 million, a level that now surpasses the production capacity of the entire United States in that segment. Medium-calibre ammunition has seen a fivefold increase to 4 million rounds per year.

The company is not stopping there. Management is targeting revenues above €14 billion for the current financial year, a roughly 40 percent leap from 2024 levels. To handle the flood of orders, the group plans to expand its global workforce to around 70,000 employees by 2030.

The Puma deal and the drone push

The latest bumper order comes from the German government, which has activated a major extension of an existing framework agreement for 200 Puma infantry fighting vehicles. Rheinmetall will build the armoured vehicles jointly with partner KNDS, with deliveries to the Bundeswehr starting in mid-2028. The contract is worth approximately €4.2 billion.

Beyond traditional armour, the company is also pushing into next-generation unmanned systems. On the Ohrdruf training ground, Rheinmetall recently tested a swarm of AI-controlled drones, combining reconnaissance and armed aerial vehicles under a single command-and-control software called C2-UMS Bw. The German military plans to deploy this system in Lithuania by 2027, filling what analysts had previously identified as a gap in Rheinmetall’s portfolio.

Infantry digitisation adds to the backlog

The Bundeswehr’s modernisation drive extends well beyond heavy weapons. The parliamentary budget committee recently approved €1.3 billion for the digital equipment of infantry units. Rheinmetall will begin delivering new systems to thousands of soldiers from the end of 2027.

All of this contributes to a record order book that would make most industrial companies envious. Yet the market remains unimpressed.

The paradox on the price chart

Analysts are struggling to reconcile the stock’s weakness with the fundamental picture. Many have price targets above €2,000, implying significant upside from current levels. Profit-taking after a long rally and a broader market consolidation are the most commonly cited explanations for the divergence.

The real test comes on 7 May, when Rheinmetall publishes its first-quarter results. Investors will be looking for concrete evidence that the massive capacity expansion is translating into improved margins and free cash flow. Inflationary pressures in the defence sector have already forced the Bundeswehr to halt some procurement projects, and any signs of margin compression could further weigh on sentiment.

For now, the task facing management is clear: prove that the company can deliver its billion-euro orders on time and at a profit. If Rheinmetall hits those targets, the share price may eventually find the fundamental support that its operational performance already justifies.