Rheinmetall’s target on UBS is raised as Trump continues to push for greater defense power By Investing.com

Investing.com — Research analysts at UBS Global upgraded their target price. Rheinmetall (ETR:) to €805 from €630 in Thursday’s note.

This revision reflects a growing sense of optimism around the company’s future amid geopolitical tensions and a global trend toward higher defense spending.

The backdrop for this optimism is largely linked to the political climate in the United States, where former President Donald Trump has been a strong proponent of increasing military budgets.

Bilateral consensus calling for continued increases in defense investments is strongly felt, recognizing the importance of enhancing national security in the face of emergencies.

This political movement not only affects US defense spending, but also has a significant impact on global markets, with allied nations reassessing their defense strategies and budgets.

UBS analysts point out that the German arms manufacturer is looking to take advantage of this shift in defense priorities.

The company is not only a manufacturer of military equipment; It is innovating in areas such as advanced combat vehicles, ammunition systems and digital warfare technologies.

By investing in research and development, Rheinmetall aims to adapt its offering to the growing demand for next-generation military capabilities.

This proactive approach increases its competitive edge, allowing the company to remain relevant in the rapidly evolving defense environment.

Moreover, the geopolitical landscape further emphasizes the need for countries to strengthen their military preparations.

Rheinmetall will benefit from procurement contracts and cooperation with national governments to modernize their defenses.

Growing threats to international security are prompting many countries to increase their defense spending, creating a favorable environment for defense contractors.

UBS notes that Rheinmetall’s diversified portfolio, which covers the defense and automotive sectors, provides a buffer against market volatility.

This diversity allows the company to use different sources of income, ensuring stability and growth potential even in changing market conditions.

As countries prioritize their defense spending to respond to growing threats, Rheinmetall could emerge as a key player in providing the necessary equipment and technology.