Bernstein Lowers Rheinmetall Price Target to EUR 2,000 Amid Sector Correction
Bernstein analyst Adrien Rabier has lowered the price target for Rheinmetall AG to EUR 2,000 from EUR 2,050 while maintaining an Outperform rating, citing sector corrections and risks related to funding erosion for ground combat. Despite a significant stock decline and profit projections below consensus, demand remains strong with a substantial backlog in its Ammunition and Vehicle segments. Rheinmetall is also focusing on military operations, planning to divest its civil business by Q1 2026, and has secured a major contract for air defense systems from the Netherlands.
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Bernstein analyst Adrien Rabier has reduced the price target for Rheinmetall AG to EUR 2,000 from EUR 2,050 while maintaining an Outperform rating. This adjustment reflects a sector correction impacting Rheinmetall due to its exposure to Ukrainian support and short-cycle products.
The stock has seen a significant decline over the past three months but maintains a high P/E ratio of 92.91. Bernstein expresses caution regarding funding erosion risks for ground combat amidst a potential cease-fire and pricing pressures on short-cycle products.
Despite these concerns, demand remains robust with a substantial backlog in Ammunition and Vehicle businesses. Rheinmetall's 2030 profit projections are about 10% below consensus and over 20% below its targets, but Bernstein views current share prices as overly pessimistic. Rheinmetall plans to sell its civil business by Q1 2026 to focus on military operations and has secured a major contract from the Netherlands for air defense systems, with deliveries starting in late 2028.
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