Leonardo still recovering with possible contract in the US

(Il Sole 24 Ore Radiocor) - A third session of recovery for Leonardo - Finmeccanica, which is trying to put behind it the collapse of the beginning of the week. Thus, while Milan's Ftse Mib is on parity, the stock of the group led by Roberto Cingolani is approaching the levels of 19 August, when its shares plunged more than 10 per cent.

Purchases on Leonardo - which on the eve of the meeting (21 August) had already benefited from an upward revision of its target price by Jp Morgan analysts (from EUR 47.5 to EUR 55.5) - were fuelled by rumours of a new possible contract in the US. According to press rumours, the Italian company's M346 trainer could in fact be selected by the US Navy to replace the fleet of T-45 Goshawks, which have now reached the end of their operational life. According to rumours, the tender involves more than 145 aircraft as well as simulation and training services, with an estimated value of over $4 billion. A share equal to '20% of Leonardo's annual order intake', according to Intermonte analysts.

The group led by Cingolani is participating in the bidding with the American Textron, offering a version of its M-346 assembled in the USA. The transaction has a 'good chance of success' and was expected, according to Intermonte, which confirms its Outperform rating on the stock. In terms of timing, the request for proposal should be issued in December 2025, with the contract being awarded in 2027. In fact, the US Navy plans 'to start replacing its trainers in 2030', analysts explain.

Leonardo thus continues on the road to recovery, as do other European defence stocks: from Rheinmetall in Frankfurt, to Bae System in London and Thales in Paris. De-escalation in Ukraine no longer seems as imminent as it had appeared at the beginning of the week, after the meeting (on 18 August) between US President Donald Trump, Kiev's number one, Volodymyr Zelensky, and European leaders. The tycoon himself took a step back in the mediation between Russia and Ukraine, leaving the organisation of the first bilateral meeting to the parties concerned. In addition, Russian Foreign Minister Sergey Lavrov stressed that Moscow cannot accept a situation in which collective security guarantees for Ukraine are resolved without Moscow. A position that could bar the way to an understanding in the near future. On the other hand, the Middle East front is hotter than ever, with the Israeli army starting occupation operations in the Gaza Strip.