Remember how Olaf Scholz announced the „turning of the times“ after Russia’s attack on Ukraine? So far, not much has been seen from our Bundeswehr. However, it had consequences for the German index landscape. In light of the strong prior price development, the share of the armaments manufacturer Rheinmetall entered the DAX in March. Unlike many other DAX climbers in the past, the performance can be seen so far. Since then, the share price has increased by 18%. Rheinmetall is currently in an extremely exciting starting position.

Rheinmetall: Armaments manufacturer and auto parts supplier The company was founded in 1889 and is based in Dusseldorf. The group is primarily known as a provider of security and defense technology for the military. This includes armored tracked vehicles, air defense systems, weapons and ammunition, among other things. In addition, Rheinmetall is also active as an automotive supplier and provides modules and systems around the engine. Among other things, the group produces products in the areas of air supply and pollutant reduction or pumps and pistons.

However, the more important sector is the armaments sector. In the past business year 2022, it was responsible for around three quarters of the revenue.

Order intake more than doubled In the past year 2022, global arms spending increased by 6% to 2.24 trillion euros, reaching a new record level. In Europe, they grew above average by 13%. A major beneficiary of this development – which will probably intensify in the near future – is Rheinmetall.

As the company recently announced, sales in the first nine months of 2023 increased by 13% to 4.6 billion euros. Operating profit increased by 17% to 387 million euros. For the full year, the company confirmed its forecast and continues to expect a sales increase of up to 19% to 7.4 to 7.6 billion euros. Further growth is programmed. This is underlined by the order intake, which increased by a whopping 130% to 14.5 billion euros from January to September.

Rheinmetall share before new highs After the data was presented, the Rheinmetall share rose and even briefly exceeded its previous record from April this year at just over 281 euros. If there is a breakout from a more than seven-month sideways movement to a new all-time high, this would be a strong trend signal.

A lot speaks for a start of a strong medium-term trend boost. In this case, prices in the range of 340 euros are a realistic goal for the coming months.