Rheinmetall's Transatlantic Tightrope: Record Orders in the US Can't Lift a Share Price Down 48% From Its Peak

Rheinmetall's record €80B backlog and US Army milestone contrast with a 32% share decline since January, as analysts see over 100% upside.

The arithmetic is stark. Rheinmetall's order book stands at more than €80 billion, its American subsidiary is handing over hardware to the US Army, and at least one major bank sees the stock doubling from here. Yet the shares are trading within a whisker of their lowest level since July, having surrendered nearly a third of their value since the start of the year.

That disconnect was on full display on Tuesday, when the Düsseldorf-based defence group's stock rebounded 2.7 per cent to €1,050.80. The bounce came a day after the shares touched €1,016, their weakest point in months, and was triggered by a characteristically bullish intervention from Goldman Sachs. The US bank reaffirmed its buy rating with a price target of €2,300 — implying upside of more than 100 per cent from current levels — and argued that even in a bear case for the group's ammunition division, a fair value of €1,450 was justified.

The recovery, however, leaves the stock firmly below its 50-day moving average of €1,098.53, a technical signal that the recent weakness has yet to run its course. The gap between the chart and the story could hardly be wider.

A Milestone in Michigan, a Foothold in Washington

The fundamental narrative, at least, remains intact. American Rheinmetall has delivered the first prototype of its Lynx XM30 infantry fighting vehicle to the US Army, formally entering the contest to replace the ageing Bradley fighting vehicle — a competition that could be worth billions. The handover, reported by Reuters, marks a significant step in the group's long-running effort to embed itself as a supplier to the Pentagon.

That headline development was accompanied by a steady drumbeat of smaller wins across the Atlantic. Rheinmetall reported the delivery of replacement components for mobile ground launchers to the US Navy, while American Rheinmetall secured a roughly $710,000 order from Kongsberg Defence & Aerospace for machined components used in MCT-30 turrets. Production is scheduled for 2026 and 2027 at facilities in Lapeer and Lansing, Michigan.

The pattern is deliberate. Rheinmetall is not merely chasing the marquee programmes; it is also weaving itself into the US defence supply chain through a series of incremental contracts that, taken together, build a durable transatlantic presence.

Kassel Expansion and a German Logistics Bet

Closer to home, the group continues to pour money into its domestic manufacturing base. Rheinmetall is pressing ahead with the expansion of its tank plant in Kassel, which Handelsblatt has reported is set to become the largest facility of its kind in Europe. The company is investing €270 million in the site, with the state of Hesse contributing €25 million. Staffing is expected to rise from 2,200 to 3,000 employees by 2028, and a final decision on the project is anticipated as early as this month.

Separately, the group has announced a three-digit million-euro investment in a new logistics and technology centre at Kassel-Calden airport, backed by a letter of intent with the Hesse state government. The facility is slated to begin operations by the end of 2027.

The order pipeline feeding these investments remains robust. The Bundeswehr's "Arminius" programme could reach a total volume of up to €40 billion, with the first tranche alone — covering 1,500 vehicles — valued at €12.4 billion. Rheinmetall's overall order backlog stood at more than €80 billion at the end of June, a figure the company's investor relations team puts at €80.4 billion as of 30 June 2026.

A Market That Refuses to Play Along

None of this has been enough to arrest the share price slide. Over the past 30 days, the stock is down 8.2 per cent; since the start of the year, the decline has reached 32 per cent. The shares now sit 48 per cent below their 52-week high of €2,007.00, reached on 3 October 2025 — a gap that underscores the scale of the reversal since last autumn.

The market's scepticism is not universal. Deutsche Bank Research reaffirmed its "Buy" rating in early September with a price target of €1,800, while MWB Research has nudged its stance to "Hold", reflecting a more cautious view on near-term momentum. Critics point to a valuation that may only normalise once earnings growth materialises from 2027 onwards, leaving the stock exposed to sharp swings in the interim.

Investors will be looking for clarity on 5 November, when Rheinmetall reports third-quarter results. A capital markets day follows roughly three weeks later, offering management a platform to flesh out its medium-term targets. Before then, the group's leadership will have two further opportunities to press its case with institutional investors: appearances at Morgan Stanley's "Industrial CEOs unplugged" event on 8 September and the Jefferies Industrials Conference the following day.

For now, the tension between a record order book and a share price in retreat remains the defining feature of Rheinmetall's market story. The company's operational momentum is beyond dispute — the question the market keeps asking is whether the valuation has already priced in the promise.