Rheinmetall’s Q1 Test Looms as a €1bn Bundeswehr Order and First Warship Launch Fail to Lift the Stock

Rheinmetall faces a pivotal week with Q1 results due May 7, as shares languish 15% lower year-to-date despite a €1.04bn German military order and first warship christening.

The Düsseldorf-based defence contractor is heading into a pivotal week with its share price nursing a 15% year-to-date decline, despite a flurry of positive corporate developments that include a maiden warship christening and a fresh €1.04bn order from the German military.

Rheinmetall shares closed at €1,357.80 on Friday, barely budging from the intra-month lows touched in late April. The stock now trades well below its 200-day moving average of roughly €1,673, a technical level that analysts say must be reclaimed before any sustained recovery can take hold. Market observers have identified a support zone between €1,300 and €1,339, while a decisive break above €1,550 is seen as a prerequisite for a meaningful bounce.

Profitability Under the Microscope

All eyes will be on Thursday, 7 May, when management releases first-quarter results. The consensus estimate among analysts stands at earnings per share of €2.90, but the focus is squarely on margin performance. After a revenue dip in the final quarter of 2025, the company must demonstrate that its bulging order book is translating into operational efficiency rather than just top-line growth.

The Q1 report will be followed almost immediately by the annual general meeting on 12 May, where shareholders will vote on a proposed dividend of €11.50 per share for the past financial year — a significant increase from the €8.10 paid out in the prior period.

Naval Ambitions and Infantry Contracts

The week also brought two major milestones that underscore the breadth of Rheinmetall’s expanding portfolio. On 29 April, the group’s newly formed Naval Systems division christened the corvette LÜBECK at Blohm+Voss in Hamburg — the first ship launch in the company’s history, according to chief executive Armin Papperger. The 89-metre vessel, designed for coastal operations and reconnaissance in the North and Baltic Seas, is the fifth and final ship of the second batch of K130-class corvettes for the German Navy. It now moves to final outfitting and commissioning.

Separately, the Bundeswehr has exercised an option to order infantry equipment under the “Infanterist der Zukunft – Erweitertes System” (IdZ-ES) programme. The contract, valued at approximately €1.04bn, covers body armour, night-vision devices and uniforms, reinforcing Rheinmetall’s role as a lead systems integrator for digital soldier systems.

Strategic Expansion in Missiles

Beyond the near-term earnings focus, the company is pressing ahead with longer-term strategic initiatives. A planned joint venture, Rheinmetall Destinus Strike Systems, is slated for formation in the second half of the year. The partnership aims to establish industrial-scale serial production of cruise missiles and ballistic rocket artillery, with Rheinmetall holding a 51% majority stake.

Analyst Conviction Remains

Despite the stock’s recent weakness, sell-side analysts see considerable upside. The median price target among those covering the name stands at approximately €2,102, while Bernstein has maintained a target of €2,050. To reach those levels, the shares would need to overcome both the 200-day moving average and the broader bearish sentiment that has weighed on the defence sector this year.

The next fortnight will be decisive. The Q1 numbers on Thursday will either validate the market’s caution or provide the catalyst for a long-awaited recovery — and the dividend vote five days later will offer a further gauge of investor sentiment.