Rheinmetall could be worth 17 billion euros in the medium term

BERLIN (Reuters) – The CEO of Germany’s biggest defense contractor Rheinmetall said he expected the company’s stock market value to rise further due to the war in Ukraine and increased spending on defense in Europe.

“Our operating profit in 2025 should be around 1.5 billion euros ($1.6 billion), maybe even 1.7 billion euros. For a fair valuation, multiply that by a factor of 11 or 12. That gives you an order of magnitude,” CEO Armin Papperger told German newspaper publisher RND in an interview published on Saturday.

“A valuation of 17 billion euros is realistic for Rheinmetall in the medium term,” he added.

The current valuation of Rheinmetall shares is around 10.5 billion euros, on a 2022 operating result of 754 million euros.

The stock market value of the company, a maker of tanks, ammunition and other war equipment, has tripled since December 2021 and it joined Germany’s blue chip DAX index earlier this year.

($1 = 0.9305 euros)

(Reporting by Christian Kraemer, Holger Hansen, Writing by Sabine Siebold; Editing by Kirsti Knolle and Madeline Chambers)

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