Rheinmetall (RHM) AI Stock Analysis

• Market Cap: €83.12B
• Dividend Yield: 0.44%
• Average Volume (3M): 309.84K
• Price to Earnings (P/E): 105.9
• Beta (1Y): 0.79
• Revenue Growth: 41.65%
• EPS Growth: 42.12%
• Country: DE
• Employees: 29,515
• Sector: Industrials
• Sector Strength: 93
• Industry: Aerospace & Defense
• EPS (TTM): 1.91
• Shares Outstanding: 45,659,590
• 10 Day Avg. Volume: 309,587
• 30 Day Avg. Volume: 309,843
• PEG Ratio: 20.47
• Price to Book (P/B): 16.90
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 53.49
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €1,887.83
• Price Target Upside: 0.31% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 13

• Rating: 72 Outperform
• Price Target: €2,035.00 ▲(8.13%Upside)

Rheinmetall's strong financial performance and positive technical indicators are driving the stock's positive outlook. However, the high P/E ratio raises concerns about overvaluation, and the low dividend yield offers limited appeal for income investors. The absence of specific earnings call insights or notable corporate events means the score is primarily influenced by existing financial and technical data.

Positive Factors

Defense Spending

Proposed changes could pave the way for sustainably higher defense spending in Germany.

Earnings

Strong growth across all defense businesses with sales up 49-93%.

Financial Performance

Free cash flow at €266 million, 26% ahead of expectations.

Negative Factors

Costs

Higher ramp-up costs for the new ammunition production in Unterluess and the F35 fuselage production in Weeze impact margin expectations.

Guidance

FY25 revenue outlook is slightly below consensus despite the revenue slippage from 4Q24 into FY25 while guided margin of approximately 15.5% falls short of consensus of 16.3%.

Revenue

RHM reported FY24 results with 4Q24 group revenue approximately 6% below VisibleAlpha consensus as deliveries worth around €200m have slipped from 4Q24 into FY25.

Rheinmetall Business Overview & Revenue Model

Company Description

Rheinmetall AG provides technologies to the mobility and security sectors worldwide. The company operates in five segments: Vehicle Systems, Weapon and Ammunition, Electronic Solutions, Sensors and Actuators, and Materials and Trade. The Vehicle Systems segment offers combat, support, logistics, and special vehicles, including armored tracked vehicles, CBRN protection systems, turret systems, and wheeled logistics and tactical vehicles. The Weapon and Ammunition segment provides threat-appropriate, effective and accurate firepower, and protection solutions, such as large and medium-caliber weapons and ammunition, weapon stations, protection systems, and propellants and powders. The Electronic Solutions segment offers a chain of systems network, such as sensors, networking platforms, automated connected effectors for soldiers, and cyberspace protection solutions, and training and simulation solutions. Its products include air defense systems; soldier systems; command, control, and reconnaissance systems; fire control systems; sensors; and simulations for the army, air force, navy, and civil applications. The Sensors and Actuators segment provides a portfolio of products comprising 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; and industrial solutions. The Materials and Trade segment focuses on the development of system components for the basic motors, such as engine blocks, structural components, and cylinder heads; plain bearings, and bushes; and replacement parts. It also engages in the aftermarket activities. The company was formerly known as Rheinmetall Berlin AG and changed its name to Rheinmetall AG in 1996. Rheinmetall AG was founded in 1889 and is headquartered in Düsseldorf, Germany.

How the Company Makes Money

Rheinmetall AG generates revenue through its two primary divisions. The Automotive division earns money by supplying automotive parts and systems to major car manufacturers and suppliers worldwide. Key revenue streams include sales of engine components, mechatronic systems, and aftermarket products. Furthermore, the company invests in research and development to innovate in areas like electric mobility and emission reduction, which attract more business from environmentally-conscious automotive clients. The Defence division is a significant revenue driver, with earnings coming from the sale of military hardware, such as armored vehicles, ammunition, and advanced electronic systems to governments and defense contractors globally. Rheinmetall's defense business benefits from long-term contracts and partnerships with national defense agencies, ensuring steady income. Additionally, the company engages in joint ventures and strategic alliances to expand its technological capabilities and market reach in both the automotive and defense sectors.

Rheinmetall Financial Statement Overview

Summary

Rheinmetall demonstrates remarkable financial performance with strong growth in revenue and profitability, supported by a solid balance sheet and excellent cash flow generation. The company maintains a stable financial structure with moderate leverage and efficient cash management, positioning it well for future growth. However, the increase in debt should be monitored.

Income Statement

Rheinmetall showcases strong revenue growth with a notable increase from €7.18 billion in 2023 to €9.75 billion in 2024, indicating a growth rate of 35.9%. The gross profit margin is robust at 51.9%, while the net profit margin has improved to 7.4% in 2024, reflecting improved operational efficiency. EBIT and EBITDA margins are also strong at 24.1% and 18.0% respectively, indicating solid profitability.

Balance Sheet

The balance sheet reflects a healthy equity position with stockholder's equity rising to €4.05 billion in 2024. The debt-to-equity ratio is manageable at 0.60, suggesting moderate leverage. The equity ratio is strong at 28.2%, providing a stable financial foundation. However, the increase in total debt to €2.42 billion warrants monitoring.

Cash Flow

The cash flow statement indicates substantial growth in free cash flow, rising from €345 million in 2023 to €988 million in 2024, a growth rate of 186.4%. The operating cash flow to net income ratio is robust at 2.40, indicating strong cash generation relative to net income. Free cash flow to net income ratio is 1.38, reflecting efficient cash management.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.47B	9.75B	7.18B	6.41B	5.66B	5.88B
	Gross Profit
5.32B	5.06B	3.94B	3.38B	3.03B	2.94B
	EBIT
1.47B	1.41B	854.00M	754.00M	624.00M	293.00M
	EBITDA
1.85B	1.77B	1.23B	960.00M	838.00M	644.00M
	Net Income Common Stockholders
753.00M	717.00M	535.00M	474.00M	432.00M	1.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.08B	1.25B	915.00M	696.00M	1.22B	1.04B
	Total Assets
14.66B	14.34B	11.94B	8.09B	7.73B	7.27B
	Total Debt
0.00	2.42B	1.91B	972.00M	921.00M	1.02B
	Net Debt
-1.08B	1.24B	1.06B	427.00M	-118.00M	-4.00M
	Total Liabilities
9.73B	9.88B	8.30B	5.01B	5.11B	5.21B
	Stockholders Equity
4.47B	4.05B	3.32B	2.81B	2.42B	1.89B
Cash Flow		Free Cash Flow
1.47B	988.00M	345.00M	-175.00M	419.00M	216.00M
	Operating Cash Flow
2.25B	1.72B	743.00M	174.00M	690.00M	453.00M
	Investing Cash Flow
-1.22B	-1.17B	-1.18B	-534.00M	-462.00M	-188.00M
	Financing Cash Flow
-472.00M	-234.00M	746.00M	-131.00M	-202.00M	-148.00M

Rheinmetall Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1882.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:RHM, the sentiment is Positive. The current price of 1882 is above the 20-day moving average (MA) of 1775.57, above the 50-day MA of 1555.42, and above the 200-day MA of 897.08, indicating a bullish trend. The MACD of 94.01 indicates Positive momentum. The RSI at 68.41 is Neutral, neither overbought nor oversold. The STOCH value of 57.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:RHM.

Rheinmetall Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RHM	72 Outperform	€83.12B	105.95	21.45%	0.44%	41.65%	42.12%
Sector *	66 Neutral	$4.49B	12.28	5.32%	248.53%	4.08%	-12.00%
0FC9		€19.18B	30.07	20.33%	0.62%	―	―
0FH7		€1.46B	381,000.00	<0.01%	0.79%	―	―
8TRA	74 Outperform	€15.11B	6.00	14.10%	5.66%	-2.53%	-4.91%
SMEGF		$80.03B	374.77	1.79%	―	―	―
HAG	70 Outperform	€11.71B	125.93	10.95%	0.49%	25.46%	41.26%