Berenberg Cuts Rheinmetall Price Target, Forecasts After Germany's Frigate Program Cancellation

Berenberg lowered its price target and earnings forecasts for Rheinmetall (RHM.F) ahead of the German arms maker's second-quarter results set for release Aug. 6, taking into account Germany's recent cancellation of the F126 frigate program. "The Q2 release will highlight progress on overcoming the ammunition and truck shipment issues in prior quarters, in our view. The F126 frigate cancellation has limited impact on our estimates, but it has led to heightened attention on the upcoming ramp-up and order intake schedule," analysts said in a Wednesday earnings preview note. "Key to improving sentiment is evidence of further progress on de-risking the outer-year ramp-up, in our view." As such, the research firm slashed the price target to 1,600 euros from 1,750 euros, with an unchanged buy recommendation on the stock. The adjusted EPS estimates for the company were reduced by 1.3% for 2026, 1.7% for 2027 and 1.6% for 2028. Revenue and adjusted operating profit forecasts for all three years were also cut. For the second quarter, Rheinmetall is expected to report a 60% year-over-year surge in revenue to 3.14 billion euros, mainly driven by a projected double-digit growth in its.