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Investing.com - Deutsche Bank (ETR:DBKGn) has raised its price target on Rheinmetall (ETR:RHMG) AG (ETR:RHM) (OTC:RNMBY) to €1,950 from €1,800 while maintaining a Buy rating on the German defense contractor.
The price target increase follows Germany’s announcement of plans to increase defense spending to 3.5% of GDP by 2029, which Deutsche Bank views as a "sizeable positive" for Rheinmetall due to its significant exposure to the domestic budget.
Deutsche Bank highlighted that the resulting visibility on budget increases and long-term spending should be a differentiating factor for Rheinmetall among its peers in the defense sector.
The bank does not expect Rheinmetall to adjust its 2025 guidance during the upcoming Q2-25 reporting period, but anticipates the company will emphasize longer-term opportunities, with potential guidance updates more likely in Q3 or during the Capital Markets Day.
Deutsche Bank’s updated price target reflects raised long-term forecasts for Rheinmetall, while Q2 numbers are expected to confirm recent management comments on growth as well as factors such as operational disruption in Spain and a pull-forward effect from Q1.
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