Research Insights | Valuation Analysis

Valuation Analysis: TKMS

11. August 2026

SubmarinesNATOTKMSDefense Stocks

Lina Mosentseva

Co-Founder und Finanzanalystin

TKMS AG & Co. KGaA at a glance

TKMS as a beneficiary of European and NATO naval rearmament – with a record order backlog, Canada opportunity, and increasing profitability.

TKMS AG & Co. KGaA

Analysis Result: 5 out of 5 MUMAKS

TKMS is one of the world’s leading companies in the field of maritime defense. The company develops and builds conventional submarines, frigates, and other surface vessels, while Atlas Elektronik supplies sonar systems, torpedoes, command systems, and maritime electronics.

Since October 20, 2025, TKMS has been listed as an independent company on the Frankfurt Stock Exchange.

The investment thesis is increasingly shaped by the strong expansion of maritime procurement within NATO. At the end of March 2026, TKMS reported a record order backlog of EUR 20.6 billion. In July, Canada selected Team 212CD as the preferred bidder for a potential fleet of twelve submarines. TKMS stated that a successful contract conclusion would increase the existing order backlog by more than 50%.

The operating business is also already improving. In the first half of the 2025/26 fiscal year, revenue rose by 10%. The adjusted EBIT margin reached 5.1%, while the company maintained its forecast for revenue growth of 2-5% for the full year.

The next quarterly statement is scheduled for August 12, 2026.

Valuation

This analysis assesses TKMS under the UMBRELLA strategy using the MUMAK method.

The valuation is conducted across five decision-making phases: Geopolitics, Industry, Fundamentals, Market Sentiment, and Technical Analysis.

The goal is not to predict the future precisely. The goal is orientation. We contextualize facts, demonstrate causal relationships, and structure a comprehensible decision logic.

We explain – you decide.

Geopolitics

Classification

TKMS benefits from the rebuilding of European and NATO naval forces. Submarines, anti-submarine warfare systems, maritime surveillance, and the protection of vital sea lanes in the Atlantic and Baltic Seas have gained significant priority in defense spending.

The Type 212CD submarine program is a central growth driver for TKMS. Germany and Norway are already using the program, and Norway increased its order to six submarines in January 2026. In July, Canada selected Team 212CD as the preferred bidder for up to twelve submarines. If a final agreement is reached, Germany, Norway, and Canada could operate submarines based on the same platform.

Opportunities

Rising European defense spending: Higher defense budgets support demand for submarines, frigates, and naval systems.
Growing NATO cooperation: Germany, Norway, and potentially Canada could deploy the Type 212CD submarine.
Opportunity in Canada: Canada has selected TKMS as the preferred bidder for its new submarine program.
Modernization of the German Navy: Germany is investing in new submarines and frigates.
Strategic importance: Maritime defense is gaining importance in the Baltic Sea and the North Atlantic.
International expansion: Projects in Canada and India could reduce dependence on the German market.

Risks

Dependence on government budgets: The majority of TKMS orders depend on public defense spending.
Political delays: Large military projects can be postponed.
Long procurement processes: The conclusion of large contracts can take several years.
Changing priorities: Elections or political shifts can influence defense spending.
Export restrictions: European regulations can restrict sales to certain countries.

Key Takeaway: Higher defense spending and stronger NATO cooperation support TKMS, but large orders remain dependent on political decisions.

MUMAK.me Rating Phase 1: Positive = 1 MUMAK

TKMS AG & Co. KGaA

Geopolitics Rating: positive

Industry

Classification

After years of limited investment in many NATO fleets, maritime defense is entering a phase of significantly higher spending. Demand for submarines, frigates, sonar systems, underwater weapons, and naval electronics is rising – all core business areas for TKMS.

TKMS is expanding its capacities in Wismar and working with international shipyards and technology partners. Atlas Elektronik also strengthens the Group’s position in naval electronics and integrated systems.

Valuation Comparison

Metric	TKMS 2026e	European Defense/Naval Peer Group*	Rating
P/E Ratio	44.7x	approx. 24-32x	Weaker
EBIT Margin	6.4%	approx. 8-12%	Weaker
Net Margin	5.6%	approx. 6-9%	Weaker
Revenue Growth	approx. 5%	approx. 7-12%	Weaker

*The peer group includes selected European defense and naval companies, including BAE Systems, Fincantieri, Saab, and Thales. Source: MarketScreener consensus.

Opportunities

Growing market for maritime defense: European countries are increasing investment in submarines, frigates, and naval technology.
Strong market position: TKMS is one of the leading providers of non-nuclear submarines.
High barriers to entry: Building modern submarines requires advanced technology and decades of experience.
Large order backlog: An order backlog of more than EUR 20 billion offers high visibility for future business.
Naval electronics: Sensors, sonar, and electronic systems broaden the TKMS product portfolio.
Long-term service business: Maintenance and modernization can generate revenue for decades after delivery.

Risks

Limited production capacities: Shipyards can only build a limited number of vessels simultaneously.
Shortage of skilled labor: Naval shipbuilding requires highly specialized employees.
Complex supply chains: Delays in components can slow down large projects.
Strong competition: European and international shipbuilders compete for large naval contracts.
Long delivery times: Building submarines and frigates can take many years.
Rising costs: Higher labor and material costs can weigh on profitability.

Key Takeaway: Rising naval spending and TKMS’s strong position in the submarine sector support the company, while production capacities and complex projects remain key challenges.

MUMAK.me Rating Phase 2: Positive = 1 MUMAK

TKMS AG & Co. KGaA

Industry Rating: positive

Fundamentals

Classification

TKMS results for the first half of the 2025/26 fiscal year show steady growth. Revenue rose by 10% to EUR 1.168 billion as the company continues to work through its existing orders.

The adjusted EBIT rose by 14%, while the adjusted EBIT margin improved to 5.1%.

At the same time, the order backlog reached EUR 20.6 billion, a new record.

Financial Performance

Metric	H1 2025/26	H1 2024/25	Change
Revenue	EUR 1.168 billion	EUR 1.060 billion	+10% YoY
Adjusted EBIT	EUR 60 million	EUR 53 million	+14% YoY
Adjusted EBIT Margin	5.1%	5.0%	+0.1 percentage points
Order Intake	EUR 3.409 billion	EUR 5.597 billion	−39% YoY
Order Backlog	EUR 20.6 billion	EUR 18.2 billion	+13%
Free Cash Flow	−EUR 72 million	+EUR 756 million	−EUR 828 million

Source: TKMS results for the first half of 2025/26.

Updated Outlook

Following the half-year results, TKMS confirmed its targets for the 2025/26 fiscal year and medium-term development:

Forecast	FY2025/26 / Medium-term Target
Revenue Growth FY2025/26	+2% to +5%
Adjusted EBIT Margin FY2025/26	>6%
Medium-term Revenue Growth	approx. 10% CAGR
Medium-term EBIT Margin	>7%
Strategic Investments FY2025/26	approx. EUR 200 million
Cumulative Free Cash Flow	>EUR 400 million over three years from FY2025/26
Dividend Payout	30-50% of consolidated net income

Source: TKMS results for the first half of 2025/26.

TKMS confirms revenue growth of +2% to +5% for the 2025/26 fiscal year compared to the previous year. At the same time, the adjusted EBIT margin is expected to rise to over 6%. Management thus expects a further improvement in profitability despite the already strong growth in the first half of the year.

Source: Marketscreener, August 2026

Analysts expect TKMS to continue growing until 2028.

Further revenue growth: Revenue is expected to rise from around EUR 2.3 billion in 2026 to approximately EUR 3.2 billion in 2028.
Higher operating profit: Operating profit is likely to increase in line with revenue.
Improved operating margin: The operating margin could rise from around 6% to approximately 7.5% by 2028.
Rising net profit: Net profit is also expected to increase over the forecast period.

Opportunities

Growing revenue: TKMS has continuously increased its revenue in recent years.
Improved profitability: Profits and margins have improved in parallel with revenue.
Strong order backlog: Orders of more than EUR 20 billion offer good visibility for future business.
Further growth expected: Analysts expect revenue to continue rising until 2028.
Large future orders: New submarine and frigate programs could bring additional growth.

Risks

Long project cycles: Revenue from large naval orders is spread over many years.
Cash flow volatility: Customer payments can lead to strong fluctuations in cash flow between individual periods.
Cost pressure: Higher labor and material costs could weigh on margins.
Growth expectations: Current forecasts assume that TKMS can successfully ramp up production.

Key Takeaway: Rising revenue and a large order backlog support the financial outlook for TKMS.

MUMAK.me Rating Phase 3: Positive = 1 MUMAK

TKMS AG & Co. KGaA

Fundamentals Rating: positive

News, Analysts, and Market Sentiment

Classification

Recent news has strengthened TKMS’s position. The most important development occurred in July, when Canada selected Team 212CD as the preferred bidder for a possible program for twelve submarines. Delivery of the first submarine is currently scheduled for 2033.

Germany has also moved forward with plans to purchase four MEKO A-200 DEU frigates with an option for further vessels. TKMS is also pursuing projects and partnerships in markets such as India, Spain, Greece, and Brazil.

Following the Canadian announcement, the share price jumped to over EUR 94 and later fell back into the lower EUR 80 range. This shows how strongly the market reacts to news of large orders – and how quickly expectations can change.

Analyst Consensus


Average Recommendation	ACCUMULATE
Number of Analysts	7
Average price target	approx. EUR 100
Upside to average target	approx. +13%
Highest price target	EUR 135
Lowest price target	EUR 76

Source: MarketScreener, accessed in August 2026.

Interesting Fact

Source: MarketScreener consensus.

Interesting Fact

The Canadian program alone could increase TKMS’s existing order backlog of EUR 20.6 billion by more than 50%. Upon contract conclusion, it would be the largest single order in TKMS’s history and could support production, maintenance, and partnership revenue for decades.

Opportunities

Positive analyst assessment: The average analyst rating is currently Outperform.
Higher price targets: The average price target is around EUR 99.71, compared to a recent price of EUR 80.40.
Canadian submarine project: TKMS was selected as the preferred bidder for up to twelve Type 212CD submarines.
Potential for order backlog: The Canadian project could increase the current order backlog by more than 50%.
German frigate program: Germany approved four MEKO A-200 DEU frigates with an option for further units.

Risks

Wide range among analysts: Price targets range from approximately EUR 76 to EUR 135, showing differing assessments of the valuation.
Canada not yet final: Status as preferred bidder is important, but the final contract has yet to be concluded.
High expectations: Positive news has already raised expectations for future growth.
News sensitivity: Delays in large defense projects could quickly weigh on market sentiment.
Limited stock market history: TKMS has only been listed since 2025, making long-term market behavior difficult to assess.

Key Takeaway: Positive analyst sentiment and large new defense projects support TKMS, but expectations are already high.

MUMAK.me Rating Phase 4: Positive = 1 MUMAK

TKMS AG & Co. KGaA

Market Sentiment Rating: positive

Technical Analysis

Classification

TKMS stock has been volatile since the IPO. The price fell towards EUR 70 in June, rose to over EUR 94 in early July, and subsequently moved back towards EUR 80. Since then, the stock has recovered and is currently trading at around EUR 86.80.

Simply put, the technical picture has improved. However, TKMS only has a short stock market history, making long-term technical analysis less reliable.

Indicator	Rating	Interpretation
RSI (14)	Positive	Around 56; momentum is positive without the stock being overbought.
MACD	Positive	The MACD remains above the signal line, supporting the recovery.
Bollinger Bands	Positive	The price remains above the middle band but below the upper band.

Performance over the last weeks/months (as of Aug 11, 2026)

RSI (14)

Positive

RSI at around 56: Momentum has improved.
Balanced level: Buying pressure is positive but not excessively strong.
Not overbought: The RSI remains below the usual overbought threshold of 70.

Interpretation

The RSI indicates positive momentum without signs of an overheated market.

MACD (12/26/9)

Positive

Positive MACD: The MACD remains above zero.
Bullish position: The MACD line remains above the signal line.
Slower momentum: Recent performance suggests that momentum is beginning to stabilize.

Interpretation

The MACD supports the recovery, even though upward momentum has slowed recently.

Bollinger Bands (20)

Positive

Middle Band: The middle Bollinger Band is at around EUR 83.3.
Upper Band: The upper band is at around EUR 90.2.
Price above the middle band: TKMS remains in the upper half of the recent trading range.
Ongoing volatility: The relatively wide bands reflect recent price fluctuations.

Interpretation

The Bollinger Bands show an improving trend, even though the stock continues to face resistance in the EUR 90 area.

Opportunities

Improved momentum: The technical picture has improved since the June low.
Healthy RSI: The RSI remains below the overbought range.
Positive MACD: The indicator continues to support the recovery.
Breakout above EUR 93.3: A sustained rise above this level would strengthen the positive signal.

Risks

High volatility: TKMS stock can react strongly to order and company news.
Resistance at EUR 90–93: This area could limit further short-term price gains.
Loss of momentum: A drop below EUR 83.3 would weaken the recent recovery.
Stronger correction: A decline towards EUR 76 could increase technical pressure.

Key Takeaway: TKMS remains technically positive, with the resistance area at EUR 90–93 and support at around EUR 83 being the most important levels to watch.

MUMAK.me Rating Phase 5: Positive = 1 MUMAK

TKMS AG & Co. KGaA

Technical Analysis Rating: positive

What supports TKMS?

A record order backlog of EUR 20.6 billion ensures high capacity utilization for TKMS over many years.
Revenue rose by 10% in the first half of the year, and adjusted EBIT by 14%. This shows that both business activity and operating profit are growing.
Canada has selected Team 212CD as the preferred bidder for up to twelve submarines. A final contract could increase TKMS’s order backlog by more than 50%.
Germany is moving forward with plans for four MEKO A-200 DEU frigates, with the possibility of ordering further vessels.
TKMS has extensive expertise in conventional submarines, naval electronics, and anti-submarine warfare systems.
Profit margins have improved, and management is aiming for an adjusted EBIT margin of over 7% in the medium term.

What weighs against TKMS?

The Canadian project is not yet a final contract and is therefore one of the most important developments to watch.
Large submarine and frigate projects can involve delays, higher costs, and other implementation issues.
The stock is valued higher than many established European defense companies, meaning expectations are already high.
TKMS only has a short history as an independently listed company, making long-term technical analysis less reliable.

What we are watching

The Q3 update for FY2025/26 on August 12, 2026.
Whether the Canadian submarine project leads to a final contract and what the financial terms will look like.
The formal contract conclusion and further development of the German MEKO A-200 DEU frigate program.

Summary

TKMS is emerging as an increasingly important European company in the field of maritime defense. The record order backlog, improved profitability, and the potential Canadian submarine order demonstrate the growth potential the company possesses in the coming years.

TKMS must now convert major government procurement decisions into binding orders, expand its production capacities, keep projects on schedule, and translate the high order backlog into rising revenue.