FRANKFURT (dpa-AFX) - A recommendation by the investment bank Morgan Stanley and the prospect of a billion-euro order from Italy boosted the recovery of Rheinmetall shares on Wednesday. The defense contractor's shares returned above the 500 euro mark with a 4 percent gain and at the same time tested their 21-day average line.

Morgan Stanley analyst Marie-Ange Riggio set a price target of 636 euros, which is still a good 11 percent above the record of just under 572 euros set in April. According to the expert, the recent price correction has provided a good entry opportunity. Her in-depth analysis based on NATO standards shows at least six years of good predictability for rearmament in Europe alone. Rheinmetall is "misunderstood and undervalued" by the market as a whole. However, the price targets on the market sometimes even exceed 700 euros.

Added to this was the prospect of another billion-euro order for the DAX-listed company. According to the "Handelsblatt" newspaper, the Düsseldorf-based company is about to receive the largest order in its history. The Italian government wants to order the Panther main battle tank developed by Rheinmetall as well as the Lynx infantry fighting vehicle, the newspaper writes, citing industry circles. The Rhinelanders are cooperating with the local manufacturer Leonardo. The order, which will run for 15 years, is said to be worth around 20 billion euros - including maintenance. According to the plans, Italy wants to purchase at least 350 Lynx infantry fighting vehicles and more than 200 Panther main battle tanks./mis