Defense companies will remain in the focus of investors in 2026. A rating agency is now becoming more confident for the provider of highly efficient drive and control technology RENK.
• Moody’s raises RENK rating to Ba1
• Investment grade is getting closer
• Stocks react only cautiously
The rating agency Moody’s had positive news for RENK investors on Tuesday: The company raised the German transmission manufacturer’s long-term Corporate Family Rating (CFR) from Ba2 to Ba1 and the Probability of Default Rating (PDR) from Ba2-PD to Ba1-PD. The outlook was changed from positive to stable.
RENK is approaching important “investment grade”
This is a crucial step for RENK: the company is now on the threshold of so-called investment grade status. This appreciation is worth money because it usually secures the company more favorable conditions when taking on debt. At the same time, it opens the door for conservative large investors such as pension funds, which are often only allowed to invest their capital in companies with this seal of quality.
Moody’s recognizes improved operational performance
The rating agency explained its move by reflecting the continuous improvement in RENK’s operational performance and credit metrics. “We expect RENK’s Moody’s-adjusted gross leverage to decline to approximately 2.2 times by the end of 2025, compared to 2.6 times in December 2024. The company reported revenue growth of approximately 19 percent through September 2025 compared to the same period last year, driven by increased defense spending by NATO countries, with contributions from all segments and a slight improvement in margins. We “We expect that, without further M&A activity, leverage will continue to decline to below 2.0x over the next 12 to 18 months as market demand remains strong and leads to higher returns,” they added.
This is how the shares of RENK and the competition react
The new Moody’s rating has no positive impact on the financial market: RENK shares temporarily lost 2.83 percent to 59.02 euros in XETRA trading on Wednesday. In the defense sector, the market is also doing mixed: Rheinmetall shares temporarily lose 1.18 percent to 1,886.50 euros, HENSOLDT stocks also temporarily lose 2.34 percent to 87.65 euros, while TKMS bucks the trend and gains 3.52 percent to 98.65 euros.
Editorial team finanzen.net
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