Renk Clinches David Brown Defence Deal as Broker Targets Diverge and Order Book Swells to €7.6 Billion

Renk has wrapped up its acquisition of David Brown Defence from Stellex Capital Management, closing the transaction on Monday after securing all required regulatory clearances. The absorbed business now trades as RENK UK Huddersfield and is earmarked to become the group's centre of excellence for submarine propulsion systems — a strategic pivot toward underwater warfare that sits alongside the company's push into naval drives for uncrewed surface vessels.

That maritime expansion gathered pace on 29 October, when Renk unveiled propulsion solutions for unmanned surface ships ahead of Euronaval 2026. Its Renk Magnet-Motor unit also booked an order from Saab covering three Stirling power generation systems destined for a submarine programme run by a NATO member state.

Analysts Split on Valuation Despite Shared Bullish Stance

Two of Wall Street's heavy hitters reaffirmed their buy-side convictions on Thursday, though their price targets tell a story of their own. Jefferies' Chloe Lemarie kept a Buy rating with a €60 target, noting that the quarterly figures had largely matched expectations. JPMorgan, for its part, maintained an Overweight recommendation and stuck with a €50 target. Deutsche Bank Research, according to media reports, confirmed its own Buy call a day earlier with a €73 target — a spread wide enough to suggest the market has yet to settle on what Renk is worth.

The results underpinning those calls showed order intake running well ahead of revenue. For the first nine months of 2026, Renk booked orders worth €1,664.4 million, a 33.6% jump on the prior-year period. Revenue, by contrast, advanced 5.8% to €982.0 million. Adjusted EBIT came in at €158.8 million, up 12.7%.

Order Book at €7.6 Billion, but Conversion Could Drag

The backlog stood at €7.6 billion at the end of the reporting period — a formidable pipeline by any measure. Getting it turned into revenue is another matter. Renk warned Thursday that delays at major defence contractors could slow the pace at which that backlog converts into sales, with CEO Alexander Sagel pointing to hold-ups in Germany's Boxer programme as a case in point.

Management left its full-year guidance for continuing operations untouched: revenue of roughly €1.4 billion and adjusted EBIT of between €240 million and €255 million.

Portfolio Reshaping and a New Gearbox

Renk is also slimming down. Around two weeks ago the company signed a binding agreement to sell its plain bearings business to Austria's Miba AG. From the fourth quarter of 2026, that unit will be reported as a discontinued operation under IFRS 5.

On the development front, Renk reported progress on 30 October with the HSWL 406 gearbox, designed for future heavy tracked vehicles and rated for outputs of up to 1,400 kilowatts. The company is steering that work toward international programmes, Italy's NMBT effort among them.