TKMS: Kiel Shipbuilder's Order Book Keeps Growing as Analysts Set a 135-Euro Target

TKMS enters Q3 earnings with a "Buy" rating and a massive order pipeline, including German MEKO frigates and potential Canadian submarine contracts.

The German naval shipbuilder TKMS heads into next week's quarterly report with its order pipeline expanding on multiple fronts — and at least one research house convinced the market has yet to price in the full value of that backlog.

Shares closed Friday at 88.20 euros, down 2.11 percent on the day, a modest pullback that does little to dent a seven-day gain of 7.96 percent. The stock now trades roughly 8.66 percent above its 200-day moving average of 81.17 euros, keeping the longer-term uptrend that has been building since the company's stock market debut intact.

A Fresh Buy Rating With Room to Run

mwb research reaffirmed its "Buy" recommendation on Friday, setting a price target of 135.00 euros — a level that implies substantial upside from the current trading price. The analysts base their conviction on what they describe as a significant undervaluation of TKMS's record order book.

The timing is notable: the recommendation lands just one day before the company publishes its third-quarter results for fiscal year 2025/26 on August 12. The consensus forecast calls for revenue growth of 19.87 percent to 632.0 million euros, with earnings per share projected at 0.47 euros. A beat on either metric would lend further support to the mwb thesis that investors haven't fully digested the scale of contracted work.

Berlin's Warship Pivot

The most recent catalyst arrived Thursday, when the federal government formally cancelled Rheinmetall's F126 frigate programme. Rheinmetall responded by trimming its naval division's revenue outlook by 300 million euros. Berlin has instead prioritised eight MEKO frigates from TKMS, according to a Breaking Defense report — a decision that strengthens the Kiel-based company's standing as the Bundeswehr's preferred partner in surface vessel construction, a segment where it has historically been better known for submarines.

That move builds on earlier momentum. The Bundestag's budget committee had already approved funding in early July for four MEKO® A-200 DEU frigates, with options for additional units. Together, the two decisions signal a growing degree of state-backed order certainty for TKMS at a time when the company is also pushing hard internationally.

A Canadian Prize and a Spanish Alliance

Canada designated TKMS as the preferred supplier for its submarine procurement programme earlier this week — a project with a potential double-digit billion-euro price tag. That followed the handover of the largest submarine ever built in Germany roughly two weeks ago, an event that helped lift the share price by around 8.4 percent.

The Canadian news came on the heels of a memorandum of understanding with Spanish shipbuilder Navantia, signed about two weeks ago, aimed at deepening European cooperation in submarine construction. The stock gained 8.9 percent in the wake of that announcement. A joint cooperation framework between the two companies is expected to be finalised by year-end.

Blueprint for a Conglomerate in Transition

TKMS's role within its former parent company also came into sharper focus on Friday. Shareholders of ThyssenKrupp AG approved at an extraordinary general meeting the spin-off of the materials division TK Accelis. TKMS, which has traded independently since October, is increasingly cited as the template for ThyssenKrupp's broader transformation into a holding structure — evidence, in the eyes of the market, that carved-out divisions can thrive on their own.

The dual narrative — an operating business winning contracts while serving as a strategic reference point for its former parent — is sharpening the stock's profile among investors. The half-year figures published in May showed a record order book and solid gains in both revenue and adjusted EBIT compared with the prior-year period.

For now, the immediate focus shifts to Wednesday's quarterly release. With the order news flow of recent weeks — Berlin's frigate decision, the Canadian preference, the Spanish partnership — the numbers will be scrutinised for signs that these developments are translating into financial performance. The 135-euro price target from mwb research sets a high bar for what the market should be willing to pay, but the accumulation of contracts is making the bull case progressively harder to dismiss.