FRANKFURT (dpa-AFX) - German defense stocks took a sharp downturn on Tuesday following Hensoldt's newly announced targets. "The radar specialist's medium-term outlook is not being well received by the market," commented equity expert Frederik Altmann of Alpha Wertpapierhandel. "That's dragging down the shares today, even though the long-term prospects still appear intact."
Hensoldt shares lost more than 9 percent at times during the company's capital markets day. By the afternoon, the stock was down 8 percent at EUR87.40, although this still represents a gain of just over 150 percent since the start of the year. This puts the stock in third place on the MDax index of mid-cap companies, behind Renk and Thyssenkrupp.
In the Dax, Rheinmetall fell 3.9 percent to EUR1,717.00, while Renk dropped 3.5 percent to EUR63.59. Both stocks, however, remained within their recent trading ranges. Since the beginning of 2025, Rheinmetall has still posted a 180 percent gain. Renk has surged almost 250 percent, and Thyssenkrupp is up just over 200 percent. All three companies have benefited from the ongoing boom in the defense sector.
"Investors had expected significantly higher growth figures in their rearmament frenzy," explained equity expert Andreas Lipkow. "This has already led to price declines for Rheinmetall and Renk shares in recent trading weeks." Regarding the radar specialist, market participants had anticipated greater scalability of its products and services. "Now, these assumptions are being revised."
The operating result (Ebitda) targeted for 2026/27 is about seven percent below the average analyst forecast, according to JPMorgan analyst David Perry. He now expects consensus estimates to fall.
For Jefferies analyst Chloe Lemarie, Hensoldt's forecasts for 2030 are in line with expectations, but growth is "concentrated in the later phases." This, she noted, negatively impacts the targets for 2026. Hensoldt's 2026 forecast calls for growth of around 10 percent and an improvement in the Ebitda margin by about 50 basis points--meaning both targets fall short of consensus projections, which she also highlighted as a drag on the share price./ck/men/jha/
