Member Info for Stayingpatient

£11.40

JP Morgan have raised their target SP for RR to £10.40 GBP.

https://uk.investing.com/news/analyst-ratings/jpmorgan-raises-rollsroyce-stock-price-target-on-improved-outlook-93CH-4141305

I like your rationale Svend. I tend to think logically over the medium to long term when it comes to share price performance. RR is a behemoth in the FTSE 100, sixth largest by market cap, last time I checked. It's SP growth over recent years has been more like a small cap or AIM stock. Hence, it's not surprising that we're encountering these "speed bumps" as the SP moves higher...it's a bit like getting an elephant to tip toe through a tulip patch, it's doeable, it just takes time.

It's an interesting situation Napalm1. We seem to recognise the possibility that there may not be any great news coming out in the next few years for RR. I think the flip side to that scenario, is that there's a good deal of visibility as far as RR's future is concerned. It may feel "a little pedestrian", now that much of the good news has been announced. However, it provides investors with a really good investment opportunity, with a blue chip FTSE 100 company. For all the reasons I've listed previously, RR is one of the best investment play's there is. As much as I'm a long term patient investor, that doesn't day trade, I find it difficult to see RR returning less than10% p.a. I may well be wrong. But, I have a calculated hunch (not an investment recommendation) that RR will continue to deliver strong returns for shareholders for a long time yet. To wax philosophical for a moment, my wife said to me a few years ago, "wouldn't it be good if you could find the next Tesla investment". Well we're up over 500% in the last few years, so not quite a Tesla return yet, but it's certainly a great start. Let's not forget that the stellar returns many here have enjoyed, have taken place in just 30 months. Tufan & his senior leadership team have turned around what he called in 2023 "a burning platform" into a £70 plus billion cash generating Titan.

It's one of the best recovery stories that I've witnessed during 4 decades of navigating the investment world. But, believe it or not, its still early days. My handle here is "Stayingpatient" & for very good reasons. I like Warren Buffett's approach to investing. It takes the pressure off trying to anticipate which way the market will move, if I was a trader. "Knowing when to sell, is generally the easy part, knowing when to buy back is the hard part". Anyway, I wish all of you the greatest of success and may your profits enrich your lives and those you care about. Cheers for now 👍

Here here! Well said Myteethitch 👏

RR have been testing the Ultrfan fan engine technology for around a decade. It's cost the company approximately £100 million per year over that period. That is set against a rising revenue stream of nearly £19 billion in the last financial year. That's around 0.5% per year of total revenue. More than manageable and carefully costed. The SP will rise based on a number of metrics that most here, should be quite familiar with. But, put simply, a company with a strong and improving balance sheet i.e. zero debt and a strong cash reserve, that is growing it's income stream by renegotiating of some of it's contracts (mostly done now). Raising prices to realistic market levels, bringing novel products to the market, building a strong order book, controlling costs & reducing wastage, will, inevitably result in re-ratings by the credit agencies. That coupled with possible further share buy backs thereby increasing the EPS, ergo decreasing the P/E, makes the shares more attractive to buyers. The possibility of an increasing dividend, that fund managers will be drawn to, results in the SP having a lot further to run over the medium to long term.

Inspite of the costs of developing and testing of the Ultrafan, the SP has grown at a phenomenal rate in recent years. This will, in my opinion continue for some time yet. Yes, the "easy money" may well have already been made. But, there are few businesses that tick all the boxes the way that RR currently do.

SMR's, are to the technological revolution, what the printing press was to the industrial revolution. The world is at a technological Rubicon, where, once having passed over, it will never be the same again. In order for the west to keep moving forward, it needs massive amounts of clean energy for the voracious appetite that the ever unfolding digital landscape presents.

In order for developing economies not to stall, they too, need massive amounts of clean energy.

With RR having a number of strings to it's bow, I consider that there is an element of "profit by association". What I mean by that, is even though NTC makes some cogent points re: the longer lead time to profitability by RR SMR, with RR SMR being cleary seen as a heavy weight contender in the SMR sector, (unequivocally confirmed by being awarded the UK SMR contract alone), it provides even further kudos to RR as a Titan in the engineering and nuclear world.

Had HMG not selected RR, or even spilt the contract, then I suspect the SP may well have sustained a short term dent. Why?, because of how RR could have been perceived by the market, inspite of nothing having changed in it's core businesses. And that, is how the market works sometimes...perception.

The future is exceptionally bright for RR. It stands at the threshold of a new technological era and is a front runner, if not the front runner. It has a proven pedigree of engineering excellence, a proven ability to R&D and subsequent successful delivery, is well financed and has some of the finest engineers on the planet.

So, although RR SMR may take some time to become profitable in it's own right that will happen. It's parent company RR PLC will ensure that it is well shepherded through each and every stage of this next journey. In the meantime, RR core businesses will continue to thrive. Defence, aerospace and energy production are what RR does amd does extremely well.

Have a great weekend all & all the best 👍

GE have sent a team of investigators over to India.

https://uk.investing.com/news/stock-market-news/ge-aerospace-to-send-team-to-india-after-air-india-787-crash-shares-sink-93CH-4130424

Https://invezz.com/news/2025/06/11/rolls-royce-share-price-is-cheap-by-20-the-dcf-model-shows/

You're most welcome Sparkthecat 🐈

Predictive text! Backing of RR. not backing off

I meant to say. We don't know which other companies may enter the UK SMR landscape. But, I refer to my previous comments regarding, HMG's faith in and backing off RR in the development stage of their SMR technology. As I see it, this is a massive shot in the arm for UK PLC. After decades of industrial decline, it seems that more than a little light is now visible at the end of the tunnel.

Some here have opined that Terrapower etal may take a slice of the SMR pie, without giving sound scientific, robust economic reasons as to why. I think that this, given the parlous state of world affairs and the delicate situation with a once great partner the US, is highly unlikely.

Fair question Sparkythecat. RR has won the UK SMR contract. It's been awarded the contract to build three SMR's in the UK. They're the headlines. The precise contractual negotiations will now follow. One thing that's also note worthy in today's announcements, is the government's funding of Forgemaster in Sheffield, to the tune of £462 million pounds. It makes absolute sense, if the UK are to have control over their own steel supply and not be at the mercy of foreign suppliers/ competitors.

Ed Miliband speaking in Parliament now. Great to hear him say "Rolls Royce have been selected..." Now talking about Nuclear Fusion...our very piece of Sunshine technology...now that would be something! Advanced Nuclear Technology also being developed. Fair play to GBN & HMG for selecting RR. It sends a very powerful message to the world of the Government's confidence in RR. The ripple effect of this decision will be far reaching and long lasting. It bodes well for foreign orders.

She's rising lads!...now pulling in excess of 9 G's!!!

That's possibly a good idea. I understand that global issues may affect RR either directly or indirectly. However, there's far too much exchanging of opinions that may or may not be true. If I wanted to hear about historic world events, then I'd seek out reliable sources for myself. They'd be well written, with correct syntax, proper grammar and correct use of words such as their, there & they're. Mild rant over.

A poorly written article. Carney's name being wrongly spelt in a number of places. Poor grammar, not always making sense. Also, "this could cost between 1 billion and 200 billion". No author is credited with the piece...possibly A.I.

For information only, not an investment recommendation.

try this one:

https://seekingalpha.com/article/4792695-the-uk-supercharged-its-defense-industry-bab****-rolls-royce-set-to-profit

Apologies, for some reason the link isn't working.