The underlying tendency is to the upside for shares in Rheinmetall AG and the timing is opportune to get back into the stock. A comeback of the upward dynamic can be anticipated.
Summary
● The company has strong fundamentals. More than 70% of companies have a lower mix of growth, profitability, debt and visibility.
● Overall, and from a short-term perspective, the company presents an interesting fundamental situation.
● The company has a good ESG score relative to its sector, according to Refinitiv.
Strengths
● Growth progress expectations are rather promising. Indeed, sales are expected to rise sharply in the coming years.
● The earnings growth currently anticipated by analysts for the coming years is particularly strong.
● Analysts have a positive opinion on this stock. Average consensus recommends overweighting or purchasing the stock.
● Predictions on business development from analysts polled by Standard & Poor's are tight. This results from either a good visibility into core activities or accurate earnings releases.
Weaknesses
● The company appears highly valued given the size of its balance sheet.
● The valuation of the company is particularly high given the cash flows generated by its activity.
● Over the past twelve months, analysts' opinions have been revised negatively.
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Surperformance is Buy on RHEINMETALL AG since 2024-02-09
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Rheinmetall AG specializes in the design, manufacture and marketing of equipment, components and solutions for the military and civilian industries. Net sales break down by family of products as follows:
- vehicle systems (35.1%): multi-purpose wheeled and tracked vehicles (tactical military vehicles, support vehicles, logistics vehicles and special vehicles);
- sensors and actuators (20.5%): actuators, exhaust gas recirculation systems, throttle valves, exhaust gas dampers for electric motors, solenoid valves, pumps, etc. used in thermal and fluid management applications in the mobility and industrial sectors;
- weapon and ammunition systems (19.5%): automatic cannons for land, air and sea vehicles, smooth-bore weapons, artillery systems, smart projectiles, high-energy lasers, etc.;
- electronic solutions (13%): sensors and networking systems, cyberspace protection solutions, air defense systems, radar systems, technical documentation solutions, integrated electronic systems, drones and automated ground robots, training and simulation solutions;
- engine components and systems (11.6%);
- other (0.3%).
At the end of 2022, the Group had 132 production sites worldwide.
Net sales are distributed geographically as follows: Germany (29.5%), Europe (35.7%), Asia and Middle East (16.3%), Americas (9%) and other (9.5%).