FRANKFURT (dpa-AFX) - German defense stocks diverged sharply in pre-market trading on Friday morning. While Renk shares surged on the Tradegate platform, climbing as high as EUR51.74, Hensoldt slipped down to EUR66.80. Rheinmetall shares showed comparatively little movement.
Benjamin Heelan, an analyst at Bank of America (BofA), sees a long-term opportunity in the recent price correction triggered by renewed negotiations to end the war in Ukraine. However, he has reshuffled his preferences. Heelan upgraded tank transmission manufacturer Renk--previously the sector's weakest performer over the past six months--recommending the stock as a buy with a price target of EUR60.50. This marks a reversal from his previous negative rating.
Meanwhile, Heelan withdrew his recommendation for sensor specialist Hensoldt, slashing the price target to EUR77. Rheinmetall remains in his favor, though he also trimmed his price target here to EUR2,215.
Shares of engine manufacturer MTU were also strong in pre-market trading at EUR354. Heelan set a target of EUR410 and likewise recommended buying.
As for Thyssenkrupp Marine Systems (TKMS), Heelan is skeptical, assigning a price target of EUR55.70 and rating the stock as "Underperform."
