Almonty, Rheinmetall, and Hensoldt: Good Buying Opportunities Among These Three Investor Favourites

Almonty Industries: A Spectacular Success Story

The most exciting stock in this trio remains Almonty Industries. Hardly any other commodity stock has electrified investors in recent months quite like this tungsten specialist. What was once a long-overlooked niche stock has become one of the most spectacular stock market stories in the commodities sector. Following the strong rally, there has been heavy profit-taking recently. Added to this were concerns about dilution surrounding the large financing round. But that is precisely what makes the stock interesting again. After all, the investment story has not lost any steam. On the contrary, through the successful placement of USD 800 million in convertible senior notes, Almonty has significantly strengthened its balance sheet. The offering was heavily oversubscribed. After deducting costs, approximately USD 773 million will flow into the company's coffers. Almonty plans to use the money for debt repayment and to strengthen its operating business. The new CFO, Jorge Beristain, can now finance the production ramp-up and potential expansions, as well as drive forward new tungsten-related projects.

This extremely hard metal has also become a very important strategic issue. It is found in high-performance tools, machinery, electronics, aerospace technology, and modern weapons systems. Tungsten is needed wherever heat resistance, hardness, weight, and durability matter. China dominates the market, while Western countries are trying to restructure their supply chains for critical raw materials. For Almonty, this is a historic window of opportunity. The company is one of the few major tungsten producers outside of China. The major game-changer remains the Sangdong mine in South Korea. Historically, Sangdong was one of the world's leading tungsten producers for more than 40 years. Now, the project is becoming an operational reality for Almonty. With the transition to commercial production, the company could grow into an entirely new dimension of revenue and earnings. Sangdong has the potential to become one of the most important sources of tungsten outside of China.

Second Strategic Metal Story

The Canadians have long been thinking bigger than just Sangdong. In Portugal, the Panasqueira mine is already in production. Additional projects are underway in Spain. In Montana, Almonty has acquired the Gentung Tungsten project. If this were to actually result in the first commercial tungsten mine in the United States in decades, it would also be a major political coup. Washington will likely be watching very closely to see who can supply tungsten outside of China. Additional excitement comes from the molybdenum project near Sangdong. The drilling program is underway, and initial progress has been reported. Should Almonty confirm the historical data there and prove the existence of an economically viable resource, a second strategic metal story would emerge on the same property alongside tungsten. South Korea, in particular, has an interest in diversifying its supply of critical metals. For Almonty, this would be a welcome source of additional leverage.

The US Fuels the Narrative

The company's increasing focus on the US market provides further momentum. Starting in 2027, the US Department of Defense will impose significantly stricter requirements on certain critical materials. For tungsten, the emphasis will then shift more toward traceability along the supply chain. For suppliers outside China, this could open doors. If Almonty were to secure major supply contracts with customers in the US defence or high-tech industries, the investment story would change significantly once again. Almonty would then no longer be just a commodities high-flyer but a strategic cash-flow player.

Inclusion in Major US Stock Market Indices

The stock was recently included in the Russell 1000 Index and the Russell 3000 Index in the US. The Russell 3000 comprises the 3,000 largest publicly traded companies in the US by market capitalization. The Russell 1000 represents the 1,000 largest companies from that group. Almonty CEO Lewis Black described the inclusion as an important milestone. He noted that it is based solely on the company's achieved market capitalization and underscores Almonty's growing importance as a Western-oriented producer of the strategically important metal tungsten, which is indispensable particularly for the defence and high-tech industries.

Attractive Entry Opportunity

Of course, the stock remains speculative. After the multiple-year surge in its share price, expectations are already high. Recently, repeated profit-taking has led to significant pullbacks. However, this has made the risk-reward profile more attractive once again. For new investors, this may present a compelling entry opportunity. Almonty sits at the intersection of raw material scarcity, the defence boom, Western supply chain security, and high-tech demand. For investors willing to tolerate elevated volatility and who believe in the strategic tungsten narrative, Almonty stands out as one of the most interesting resource plays of the coming years—and shares can again be acquired at relatively attractive levels.

Rheinmetall: Buying Opportunity After Price Correction

Rheinmetall shares also offer new opportunities right now. For months, the stock was the epitome of the European defence boom. Tanks, ammunition, air defence, military trucks, and the digitization of the armed forces—Rheinmetall supplies almost every area where Europe is massively rearming. The rally was correspondingly strong. The subsequent disillusionment was correspondingly severe. The trigger was the setback in the F-126 naval project. The market had given Rheinmetall good odds of securing a multi-billion-dollar contract in naval shipbuilding. Then came the cold shower. Germany opted for a different solution. The stock plummeted sharply.

Order Backlog Remains at Record Levels

Operationally, however, Rheinmetall remains in an exceptionally strong position. The order backlog is at record levels, and demand for ammunition, armoured vehicles, air defence, and military mobility is structurally high. Europe will need to replenish, modernize, and rethink its capabilities for years to come. The growth potential is enormous, particularly in the ammunition business. Add to that air defence. Systems like Skynex or Skyranger strike a chord because drones and missiles have changed the nature of warfare. The premature end of the F-126 frigate program is a clear setback for the group's maritime ambitions. After all, the contract was most recently projected to be worth around EUR 15 billion. Nevertheless, it would be wrong to immediately conclude that this marks a breakdown of the entire investment story, as the contract would have been spread out over many years, well into the 2030s. For revenue and earnings, the short-term damage is therefore significantly smaller than the share price reaction would suggest.

In the short term, Rheinmetall will have to scale back its expectations regarding order intake. The EUR 80 billion in nominations and an order backlog of about EUR 135 billion by year-end, as anticipated by analysts, are likely no longer achievable. However, revenue of EUR 14-14.5 billion and an operating margin of around 19% should still be attainable. While the major maritime contract is now missing from the narrative, its impact on the income statement is not immediate.

Tailwind from rearmament remains

The underlying tailwind remains unchanged in any case. Europe is rearming. Tanks, ammunition, air defence, armoured vehicles, military trucks, and digital connectivity are precisely the areas in which NATO countries have a massive backlog to make up. Rheinmetall thus occupies a particularly sought-after position in the value chain. At the same time, the group is increasingly evolving from a traditional supplier of ammunition and tanks into a more diversified systems provider for modern defence solutions.

Stock No Longer Overvalued After Correction

The stock's valuation also appears less extreme following the price correction, provided the expected earnings estimates are actually met. The analyst consensus forecasts adjusted earnings per share of just under EUR 37 for 2026, EUR 54 for 2027, and EUR 75 for 2028. This results in P/E ratios of 26, 18, and 13, respectively. For a structurally growing defence conglomerate, this is not cheap, but it is not entirely out of line either.

Risks remain, however. Rheinmetall must ramp up capacity, integrate acquisitions, and weather political delays. A swift peace agreement in Ukraine could also weigh on sentiment. Nevertheless, the cancellation of the F-126 is frustrating but not a reversal of the trend. Rheinmetall remains one of the major beneficiaries of Europe's new era. The setback is more of a blip in the story than the end of the rally—and an opportunity for new entrants.

Hensoldt: An Investor Favourite Caught in the Crossfire

While Rheinmetall stands for steel, ammunition, and heavy systems, Hensoldt is the eye and ear of modern armed forces—radar, sensors, optronics, electronic warfare, software, and networking. The Taufkirchen-based company is involved in many key programs, ranging from Eurofighter radar and infantry fighting vehicles to air defence and reconnaissance systems. The order book is strong, and order intake has recently been exceptionally high. Profitability is also moving in the right direction. Hensoldt is benefiting from the European trend toward networked defence. Anyone who wants more air defense, drone defense, and electronic reconnaissance needs sensors. Without sensors, every modern weapons system is blind.

Strong Start to the Year

Hensoldt got off to a brilliant start in 2026. Revenue rose by 25.6% to EUR 496 million in the first quarter, and adjusted EBITDA jumped by as much as 45.9% to EUR 44 million. The figures for order intake were even more impressive. These soared by 112% to EUR 1.48 billion. The book-to-bill ratio thus stood at nearly 3. In other words, Hensoldt secured nearly three times as many new orders as it generated in revenue during the quarter. This provides ample visibility.

The Optronics segment is particularly exciting. Long considered a work in progress, this division is now emerging as a key driver of earnings. Revenue there rose by 63%, and the operating margin improved by 11 percentage points to 12.4%. Investments in new products, digitalization, and more efficient structures are beginning to pay off visibly.

High Order Backlog

Major programs are also filling the pipeline, with the order backlog now approaching the EUR 10 billion mark. Drivers include digital optronics for the Schakal wheeled armoured personnel carrier, equipment for the Leopard 2 A8, and radar systems for the Eurofighter Typhoon. Hensoldt is thus at the heart of key European defence programs.

Germany remains both a risk and an opportunity. Around 60% of revenue depends on German defence spending. Given the Bundeswehr's ongoing modernization, this now appears more like a lever than a concentrated risk. Modern platforms require ever more sensors, electronics, connectivity, and software. This is precisely where Hensoldt's strength lies.

The Stock Is No Bargain

Officially, the company remains cautious for 2026. It expects around 12% revenue growth to approximately EUR 2.75 billion, as well as an adjusted EBITDA margin of 18.5-19%. Given the strong start to the year, this forecast appears rather conservative. With an expected P/E ratio of around 41 for 2026, the stock is certainly no bargain. However, investors are paying for a multi-year growth story here. Risks related to politics, export regulations, major projects, and competition remain. The structural drivers, however, are intact.

Setbacks as Opportunities

Like the sector as a whole, the stock has taken a hit recently. Part of this is purely collateral damage. When Rheinmetall falls, defense stocks are sold off across the board. Another part is valuation discipline. After the price rally of recent months, Hensoldt was no longer cheap. Investors are now demanding more proof that the high order intake can be reliably translated into revenue, margins, and free cash flow. This is precisely where Hensoldt is increasingly providing evidence. The 2026 forecast was confirmed, and the free cash flow expectation was even raised. For Hensoldt, too, the pullback thus opens up opportunities again for new investors.

The recent price pullbacks are no cause for complacency among investors. All three stocks remain prone to volatility. Almonty is the most speculative stock with the greatest upside potential; Rheinmetall is the leading defence stock; and Hensoldt is the technology specialist. Investors looking to capitalize on critical raw materials, Western supply chain security, and European rearmament will find three investor favourites with different levers to the same major trend. The price declines of these three stocks have improved buying opportunities for interested newcomers.