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On Friday, UBS analyst Sven Weier adjusted the price target for Rheinmetall (ETR:RHMG) AG (RHM:GR) (OTC: RNMBY), a prominent defense and automotive company with a market capitalization of approximately $60.7 billion. The new target is set at €1,600, marking a significant increase from the previous target of €1,208. Alongside the price target adjustment, Weier reaffirmed the Buy rating for the company’s shares, though InvestingPro analysis suggests the stock is currently trading above its Fair Value.
The revision follows a conference call with Rheinmetall’s CEO, who expressed optimism but cautioned that it was too early for precise revenue forecasts for 2030. The company’s strong revenue growth of 36% in the last twelve months supports this optimistic outlook. Despite this, Weier anticipates that the company’s revenues will exceed initial estimates. Previously, revenues were estimated to reach €35 billion by 2030, but the new forecast suggests a conservative figure of €45 billion, which still lies below the company’s own simulation predictions.
Weier’s confidence in Rheinmetall is reflected in the reiterated Buy rating and the increased sum-of-the-parts (SOTP) based price target. The analyst considers Rheinmetall a top pick in its sector, signaling strong expectations for the company’s future performance.
Rheinmetall’s bullish stance in the conference call and the subsequent upward revision of revenue forecasts and price target by UBS underscore the company’s potential for growth. It remains to be seen how these projections will materialize in the coming years as the company continues to navigate the defense and automotive markets.
In other recent news, Rheinmetall has been the focus of several analyst updates following its latest earnings and future guidance. BofA Securities increased the company’s stock price target to EUR 1,450, maintaining a "Buy" rating, despite Rheinmetall’s fourth-quarter results not meeting expectations. The analyst highlighted the company’s potential to achieve significant sales growth by 2029, with project nominations potentially reaching EUR 50 billion to EUR 100 billion through 2030. UBS also upgraded Rheinmetall’s stock from Neutral to Buy, raising the price target to EUR 1,208, citing optimism around increased defense spending in Germany. The firm sees potential for growth even amidst political resistance to constitutional changes affecting defense budgets. Meanwhile, HSBC maintained its Buy rating with a price target of EUR 1,000, emphasizing Rheinmetall’s potential benefits from increased defense spending within the European Union. The analysts noted that the company’s strong portfolio positions it well to capitalize on anticipated EU defense spending increases. These developments reflect a broad consensus among analysts about Rheinmetall’s growth prospects amid evolving geopolitical and defense spending landscapes.
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