RHM GR

Rheinmetall AG

Industrial/Transportation


Presented:08/22/2024
Price:€533.60
Cap:$25.80B
Current Price:€483.00
Cap:$23.36B

Presented

Date08/22/2024
Price€533.60
Market Cap$25.80B
Ent Value$24.99B
P/E Ratio43.3x
Book Value€75.06
Div Yield1.07%
Shares O/S43.42M
Ave Daily Vol263,884
Short IntN/A

Current

Price€483.00
Market Cap$23.36B
Rheinmetall AG is a holding company, which engages in the provision of development and sale of components, systems, and services for the security and civil industries. It operates through the following segments: Vehicle Systems, Weapon and Ammunition, Electronic Solutions, Sensors and Actuators, Materials and Trade, and Others. The Vehicle Systems segment offers a diverse portfolio of vehicles, including combat, support, logistics, and special vehicles. The Weapon and Ammunition segment includes products and solutions for threat-appropriate, firepower as well as comprehensive protection. The Electronic Solutions segment is involved in the chain of effects in the system network, from sensors and the networking of platforms and soldiers to the automated connection of effectors, as well as solutions for protection in cyberspace. The Sensors and Actuators consists of a product portfolio with exhaust gas recirculation systems, throttle valves, control dampers, and exhaust flaps for electromotors, solenoid valves, actuators and valve train systems, oil, water, and vacuum pumps for passenger cars, commercial vehicles, and light and heavy-duty off-road applications, as well as industrial solutions. The Materials and Trade segment focuses on the development of system components for the basic motor. The company was founded by Heinrich Ehrhardt on April 13, 1889 and is headquartered in Duesseldorf, Germany.

Publicly traded companies mentioned herein: Rheinmetall AG (RHM GR)

Highlights

The presenter is long shares of Rheinmetall AG (RHM GR), a German-listed automotive and arms manufacturer, viewing it as well-positioned in key defense spending sectors to benefit from a ramp in spending following three decades of military underspending in Europe. Based on this belief, he believes consensus estimates for 2026/2027 are approximately 20% too low. Modeling 20%-30% EPS growth and underwriting a 15x earnings multiple, in line with peers, the presenter reaches a price target of around €650-€700 per share, representing 25%-30% upside from the current price.

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Idea Discussion

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