Rheinmetall under analyst pressure, shares stabilize after frigate shock

By Thomas Klein, Operations & Strategy desk. Reviewed prior to publication on 2026-06-26, 09:23.

Rheinmetall (DE0007030009) faces continued fallout from Germany’s cancellation of the multibillion-euro F126 frigate program, while the DAX-listed shares trade around 948 euros on Xetra and roughly 949 euros on Tradegate in early Friday dealings, according to exchange data.

What analysts are saying now

The political trigger for the recent correction is the German Defense Ministry’s decision to terminate the F126 project, originally valued at up to 18 billion euros for six large frigates, due to cost overruns and delays at the original contractor. Rheinmetall had sought to step in via its naval joint venture NVL, acquired for around 1.5 billion euros earlier this year, but Berlin chose rival ThyssenKrupp Marine Systems (TKMS) instead.

According to an analysis on Investing.com, Rheinmetall shares recently slid about 2.3 percent to 926.95 euros intraday and marked a new 52-week low as investors reassessed order intake prospects after the lost contract. A separate report from Handelsblatt highlights that the stock had already halved since October 2025 after a rally of more than 1,000 percent over five years, underscoring how much optimism had been priced in before the setback.

Morgan Stanley reshuffles its defense favorites

Strategically, the F126 decision has also led to a visible shift in analyst positioning. Morgan Stanley removed Rheinmetall as its top pick in the European defense sector and assigned that status to British peer BAE Systems, while keeping both stocks rated Overweight, as reported by Investing.com. The US bank cut its Rheinmetall price target by roughly 30 percent from 2,500 euros to 1,750 euros in response to the cancellation of the F126 program, which would have involved six large surface combatants.

The sector comparison shows that the investment bank still sees structural support for defense spending in Europe but expects the German group to lag BAE in the near term given the lost naval opportunity and execution concerns around its ambitious growth pipeline. For investors, that means Rheinmetall remains a major defense pure play in the DAX alongside peers such as BAE Systems and other European contractors, but without the previous leadership status in Morgan Stanley’s sector pecking order.

What the company sells

Operationally, Rheinmetall earns its money with military vehicle systems, ammunition and weapon systems as well as sensors, electronics and a civilian automotive supply segment, according to company information and analyst overviews. Key defense products include infantry fighting vehicles such as the Lynx, artillery systems, air-defense solutions and a broad range of medium- and large-caliber ammunition.

Where the shares trade today

The Rheinmetall shares (DE0007030009) trade on Xetra at 946.80 euros as of 2026-06-25, 17:37, while Tradegate quotes around 948.70 euros in early indicative trading on 2026-06-26, 08:56, both in euros.

This article is for informational purposes only and does not constitute investment advice, an offer or a solicitation to buy or sell any financial instruments. Past performance is not a reliable indicator of future results.