Kepler Cheuvreux has downgraded Kongsberg from Hold to Reduce, citing valuation concerns despite strong operational performance. The broker lifted its target price to 337 Norwegian crowns from 252 crowns but warned that shares now trade at a premium to European defence peers. The stock surged 3% in Oslo following strong Q4 results, including sales of 16.8 billion Norwegian crowns and EBITDA of 2.95 billion crowns.

Analyst Martin Granviken noted that while Kongsberg continues to deliver high margins and strong order intake, the stock has experienced significant multiple expansion that moves ahead of fundamentals. The company's order backlog reached 157.6 billion crowns, up 23% year on year, with Defence & Aerospace delivering particularly strong profitability. Despite raising 2026E and 2027E EPS estimates by 4% and 12% respectively, Kepler argues valuation has run too far.

On 2027 estimates, Kongsberg trades at a substantial premium to defence peers across key metrics. In a sum-of-the-parts framework, today's share price would imply Defence & Aerospace trading at close to 30x 2027E EV/EBITDA on a standalone basis. Granviken said limited fundamental justification exists for such valuation levels, suggesting further upside would likely require additional multiple expansion rather than earnings delivery.