Rheinmetall Stock: Peace Talks Trigger Sharp Decline

Rheinmetall shares plummeted by over 6% on Monday, making it the DAX's biggest loser despite the broader market reaching record highs. This significant drop follows weekend developments where Ukraine's President extended a surprise invitation to Russia's leader for direct talks in Turkey this Thursday, with Moscow previously signaling willingness to resume negotiations. The sudden prospect of potential peace talks appears to have melted the so-called "Ukraine bonus" that propelled Rheinmetall to an all-time high of €1,744 last Friday, prompting investors to take profits after the stock's remarkable 150% surge since the beginning of the year.

Analysts Remain Bullish Despite Correction

Despite the sudden correction, financial experts continue to see strong potential in Rheinmetall's future. Hauck Aufhäuser recently raised its price target from €1,800 to €2,200 while maintaining a "Buy" rating, citing the company's excellent positioning to benefit from the expected defense sector supercycle. Meanwhile, Rheinmetall continues its strategic transformation into a pure defense company, with plans to convert its Neuss facility from automotive parts production to manufacturing Lynx infantry fighting vehicles and howitzers, alongside developing a satellite production capability in partnership with a Finnish firm.

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Source StockWorld