Hensoldt Action Forum

Rheinmetall share: JP Morgan Chase & Co. issues Overweight rating

$RHM (+1,63 %)
$HAG (+2,31 %)
$LMT (+3,53 %)
$RR. (+0,81 %)

The US bank JPMorgan has left its rating for Rheinmetall at "Overweight" with a target price of 680 euros. Analyst David Perry discusses the exciting developments of the past 24 hours on Thursday morning. In the short term, he sees more uncertainty for the Düsseldorf-based company than for other European defense companies - due to a possible Ukraine ceasefire under Trump and the shaky coalition government in Germany. In the long term, however, he continues to see Rheinmetall as a winner with good prospects for many years to come.

#rüstung
#ukraine

The Rheinmetall-share was trading in red at 09:32 in XETRA trading, losing 0.3 percent to EUR 494.30. This means that the share still has an upside potential of 37.57 percent compared to the issued price target. The number of Rheinmetall shares traded to date amounts to 101,153. Since the beginning of 2024, Rheinmetall shares have risen by 74.1 percent. Rheinmetall is expected to present its next results for Q3 2024 on November 7, 2024.

Publication of the original report: 07.11.2024 / 07:31 / GMT First transmission of the original report: 07.11.2024 / 07:31 / GMT

⬆️⬆️⬆️

- DEUTSCHE BANK RESEARCH raises its price target for BMW from EUR 90 to EUR 95. Buy. $DBK (-2,66 %)

- BERNSTEIN raises the price target for QUALCOMM from USD 200 to USD 215. Outperform. $QCOM (-0,3 %)

- UBS raises the price target for LYFT from USD 13 to USD 18. Neutral. $LYFT (+0,66 %)

- BARCLAYS raises the price target for SIEMENS HEALTH from EUR 60.50 to EUR 62.50. Overweight. $SHL (-1,29 %)

- WARBURG RESEARCH raises the price target for KONTRON from EUR 28 to EUR 28.40. Buy. $KTN (-1,11 %)

- UBS upgrades KINGSPAN GROUP from Neutral to Buy. Target price 90 EUR. $KRX (-2,01 %)

- WARBURG RESEARCH raises the price target for ZEAL NETWORK from EUR 59 to EUR 64. Buy. $TIMA (+0,12 %)

- GOLDMAN raises the price target for VONOVIA from EUR 42.70 to EUR 43.70. Buy. $VNA (+2,7 %)

- BARCLAYS raises the price target for AHOLD DELHAIZE from EUR 30 to EUR 31. Equal-Weight. $AD (+0,73 %)

- BARCLAYS raises the target price for FMC from EUR 38.50 to EUR 39. Equal-Weight. $FMC (-1,11 %)

- JPMORGAN raises the target price for COMMERZBANK from EUR 18 to EUR 18.40. Overweight. $CBK (-1,43 %)

- JPMORGAN raises the target price for PUMA SE from EUR 40 to EUR 44. Neutral. $PUM (+0,67 %)

- JPMORGAN raises the target price for JUST EAT TAKEAWAY from GBP 13.96 to GBP 14.15. Overweight. $TKWY (+0,07 %)

⬇️⬇️⬇️

- JEFFERIES downgrades PALANTIR from Hold to Underperform. Target price USD 28. $PLTR (+5,8 %)

- DEUTSCHE BANK RESEARCH lowers the price target for NOVO NORDISK from DKK 1100 to DKK 1000. Buy. $NOVO B (+0,73 %)

- RBC lowers the price target for NIKE from 82 USD to 80 USD. Sector Perform. $NKE (+0,58 %)

- ODDO BHF downgrades ASM INTERNATIONAL to Outperform. Target price EUR 960. $ASM (-1,38 %)

- KEPLER CHEUVREUX downgrades HENSOLDT from Buy to Hold. Target price EUR 34. $HAG (+2,31 %)

- DEUTSCHE BANK RESEARCH lowers the price target for ZALANDO from EUR 40 to EUR 36. Buy. $ZAL (+1,5 %)

- DEUTSCHE BANK RESEARCH lowers the price target for VESTAS from DKK 165 to DKK 150. Hold. $VWS (-2,71 %)

- BOFA downgrades SIEMENS ENERGY from Buy to Neutral. Target price EUR 40. $ENR (+2,43 %)

- METZLER lowers the price target for VONOVIA from EUR 28.50 to EUR 28. Sell. $VNA (+2,7 %)

- BARCLAYS lowers the price target for TEAMVIEWER from EUR 18 to EUR 15.50. Overweight. $TMV (+2,46 %)

- WARBURG RESEARCH lowers the price target for KLÖCKNER & CO from EUR 6 to EUR 5.70. Buy. $KCOB

- HAUCK AUFHÄUSER IB lowers the target price for NORMA GROUP from EUR 32 to EUR 27. Buy. $NOEJ (-2,65 %)

- WARBURG downgrades EDAG ENGINEERING from Buy to Hold and lowers target price from EUR 13 to EUR 9.50. $ED4 (-1,01 %)

- LBBW lowers the price target for ALLGEIER from EUR 24 to EUR 20. Buy. $AEIA

- BARCLAYS lowers the price target for HENKEL from EUR 79 to EUR 77. Equal-Weight. $HEN (+0,21 %)

- BERENBERG lowers the price target for KRONES from EUR 157 to EUR 154. Buy. $KRN (+0,5 %)

Hensoldt optimistic for 2024 after growth $HAG (+2,31 %)

Rising military spending following the Russian invasion of Ukraine is keeping defense supplier Hensoldt on course for growth.

After significant growth in the first nine months, CFO Christian Ladurner is also optimistic for the fourth quarter. CEO Oliver Dörre believes that the radar and sensor specialist, in which the Italian armaments group Leonardo also holds a stake, is now in a position of strength with regard to the consolidation of the industry: "I say quite clearly: we want to shape this process and not be shaped." In the first nine months of 2024, incoming orders rose to around 1.86 billion euros, partly due to orders from the German Armed Forces, Hensoldt announced on Wednesday. The order backlog thus totaled 6.5 billion euros.

Turnover climbed by 21.3 percent to around 1.4 billion euros. Hensoldt worked more profitably

The adjusted operating profit (EBITDA) improved by 24.1 percent to 187 million euros.

The Management Board confirmed the outlook, and the ratio of incoming orders to sales (book-to-bill ratio) for the financial year was specified at the upper end at around 1.2.

Overall, Hensoldt expects "continued positive business development" for 2024. For the year as a whole, the management continues to expect sales of around EUR 2.3 billion and an adjusted EBITDA margin of 18 to 19 percent. "We will also see the momentum we saw in the first nine months in the final quarter," Ladurner told Reuters.

The Russian invasion of Ukraine had brought about a turnaround for Western arms companies such as Hensoldt and Rheinmetall. The industry is needed to strengthen the Bundeswehr and the armed forces of the NATO states and Ukraine.

At the same time, there are calls for alliances among European arms companies - also in order to keep up with the US arms giants. Rheinmetall and Hensoldt shareholder Leonardo recently forged an alliance to build tanks.

"We make sensors for tanks and key optronic components for the Leopard are made by Hensoldt," said Dörre: "These are topics that we are also discussing with our shareholder Leonardo." "Wherever we can add value with regard to the products, we will never turn down cooperation talks," he added. However, these would have to bring "real added value". Hensoldt will not do anything "for the sake of pure consolidation". Instead, Hensoldt is looking around for takeovers itself. "Technology and internationalization - these are the drivers for possible acquisitions," emphasized Dörre.

Finally $CRM (+4,64 %) into the depot👌 Next up $BLK
$MCD (+2,19 %)
$OR (-2,66 %)
$O (+2,65 %)
$MC (-2,6 %)
$HAG (+2,31 %)
$DTE (+0,79 %) Still a long way to go😅

$HAG (+2,31 %)
Hensoldt AG quarterly results from Friday:

Short presentation:

HENSOLDT is a pioneer of technology and innovation in defense and security electronics. The company, based in Taufkirchen near Munich, is a German champion with strategic leadership positions in the field of sensor solutions for defense and security applications.

Among other things, the company develops and produces radar systems for the "Eurofighter" and air defense as well as protection systems for "Leopard" and "Puma" tanks and markets certified avionics systems that work together with a variety of third-party avionics and sensor systems. The high-end products are in use worldwide and are characterized by their flexibility and modular concept.

About the earnings:

Hensoldt order book thicker than ever - forecast confirmed

In view of the growing European defense budgets, orders are piling up at the defense electronics group Hensoldt. In the first six months, orders totaling 1.36 (previous year: 1.07)

billion euros, 27 percent more than a year earlier, the company announced on Friday in Taufkirchen near Munich. These included, in particular, the German Armed Forces order for a new air defense system and the order for additional TRML radars for Ukraine's air defense. This increased the order backlog by almost 900 million to a record 6.55 billion euros. Hensoldt's consolidated turnover rose by 17% to EUR 849 million in the first six months of 2024, to which the acquired military service provider ESG contributed EUR 82 million.

The adjusted operating result (EBITDA) improved by 26 percent to 103 million euros. The development confirms "that our strategy is taking effect and that we have set the right course, especially in operational terms," said the new CEO Oliver Dörre. For the year as a whole, Hensoldt continues to expect turnover of around 2.3 billion euros and an adjusted EBITDA margin of 18 to 19 percent.

At the bottom line, however, Hensoldt still posted a loss of 16 million euros, the same as in the same period last year, due to a deterioration in the financial result. The management confirmed the annual forecast and specified the sales outlook at around 1.85 billion euros.

EPS: 0.113 expected: 0.048

Turnover: 520M expected: 517.28M

Dividend yield: 1.03

The company has increased its dividend for 4 consecutive years.

Source:

reuters.com, tagesschau.de & investing.com

$HAG (+2,31 %)

In the first quarter, the armaments group HENSOLDT recorded an order intake almost twice as strong as in the same period of the previous year.

Operating profit increased by more than 10 percent despite lower sales. The MDAX and TecDAX-listed group from Taufkirchen near Munich confirmed its forecast for the year as a whole, which was specified at the beginning of April following the completion of the takeover of ESG Elektroniksystem- und Logistik GmbH.

"With a record order backlog, we are in an excellent position and have very good visibility on business development," said CFO Christian Ladurner according to the press release. We were able to further increase our profitability in the first three months of 2024. We are benefiting from improved operational processes and efficient cost management. We also expect the consolidation of the successful acquisition of ESG, which is an important driver of our sales and order development, to have a positive impact for the first time from the second quarter onwards."

$HAG (+2,31 %) The acquisition of the manufacturer-independent system integrator and technology and innovation partner for defense and public safety is expected to generate annual cost synergies of EUR 19 million in addition to higher sales.

In the three months to the end of March, the Group's incoming orders rose by 91.8% to EUR 665 million, according to the press release. The Group benefited in particular from major orders in the Sensors segment, such as the order for a German air defense system received in January as a partner of Rheinmetall, as well as further orders for the TRML-4D medium-range radar. The order backlog rose by 6.3% compared to the end of 2023 to a new record high of around EUR 5.88 billion.

While revenue fell from EUR 338 million in the same quarter of the previous year to EUR 329 million, HENSOLDT further improved its profitability and increased adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) from EUR 30 million to EUR 33 million. Thanks to a positive project mix and more efficient cost management, the adjusted EBITDA margin rose from 9.0 to 10.2 percent.

The adjusted free cash flow improved from minus 137 million to minus 81 million euros compared to the same period last year. This was mainly driven by higher cash inflows from customer contracts, the Group announced. In addition, the cash flow reflects investments in working capital.

For the 2024 financial year, HENSOLDT, including ESG, expects consolidated revenue of EUR 2.3 billion, compared to EUR 1.85 billion in the previous year, and significantly faster growth in order intake compared to consolidated revenue. HENSOLDT had previously forecast an organic increase in revenue to EUR 2 billion. The adjusted EBITDA margin before low value-added business volume is expected to be 18 to 19 percent including ESG. In 2023, the corresponding margin reached 19.9%, while the forecast for organic growth was 19 to 20%.

Thanks to @Hannes_SK who showed me the opportunities of small caps through his contributions.

You always learn something new on the stock market or through the community.

$DRO (-0,77 %) was a chance find in December, as I was looking for a counterweight to $HAG (+2,31 %) and the market for anti-drone technology is very limited.

As a div-growth investor, I am not used to such price gains 🥹

What has happened? Why is the entire defense industry on a downward spiral? 😵‍💫$RHM (+1,63 %)
$HAG (+2,31 %)
$LDO (+3,07 %)

$HAG (+2,31 %)
$RHM (+1,63 %) detached from any chart and fundamental analysis...

Ukraine is far from getting what it needs to win the war. The security situation for Germany/EU/Nato will continue to deteriorate over the next few years. In order to change the situation positively, considerably more weapons (including sensor technology etc.) would have to be supplied, which would lead to greater demand, as armaments technology does not have to be put out to tender throughout Europe, the majority of German orders will go to German companies.

If not enough weapons are supplied, Ukraine will lose further regions and in the medium term the security situation for Germany/EU/Nato will deteriorate, which will lead to increased investment in armaments. Contracts still do not have to be put out to tender across Europe, which means that the majority of German money will go to German companies.

There is hardly a scenario in which arms spending will not continue to rise. Even the death of Putin would not be synonymous with peace. There are also "uncertainty multipliers" such as a possible Trump election victory, which could make further arms spending necessary.

Ultimately, only a much better equipped NATO will lead to an improved security situation (better deterrence), which would then lead to a decline in arms spending in the future.

As the willingness of countries in NATO to spend more decreases proportionally with the distance to Russia's area of interest, Germany will (have to) make a much larger contribution in future, even if it is not a direct neighbor to Russia's area of interest, due to its historical political and ultimately also geographical responsibility.

I therefore see great potential in German armaments in the short/medium and long term.

In my view, there is also no need for an ethical discussion on this occasion.

How do you see the outlook for German defense stocks? Gladly in general or also specifically....