RR Intrinsic Valuation and Fundamental Analysis - Rolls-Royce Holdings PLC - Alpha Spread

Rolls-Royce Holdings PLC
LSE:RR

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Rolls-Royce Holdings PLC Logo
Rolls-Royce Holdings PLC
LSE:RR
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Price: 537.2 GBX 1.36% Market Closed
Market Cap: 45.7B GBX
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Intrinsic Value

The intrinsic value of one RR stock under the Base Case scenario is 385.34 GBX. Compared to the current market price of 537.2 GBX, Rolls-Royce Holdings PLC is Overvalued by 28%.

The Intrinsic Value is calculated as the average of DCF and Relative values:

RR Intrinsic Value
385.34 GBX
Overvaluation 28%
Intrinsic Value
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Base Case
Best Case

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Rolls-Royce Holdings PLC

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Backtest Conclusion
Very Attractive
Current Valuation
+45%
Avg Valuation
-12%
Worst Valuation
-49%
Best Valuation
+45%

Stock is trading at its lowest valuation over the past 5 years.

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Fundamental Analysis

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Business Breakdown

Rolls-Royce Holdings PLC stands as a titan in the aerospace and defense sectors, renowned for its cutting-edge engineering and innovation. Founded over a century ago, the company initially gained prestige through its luxury automobiles, but it has since evolved into a leader in the manufacture of aircraft engines and power systems. Today, Rolls-Royce is a key player in powering commercial and military aircraft, deploying advanced technologies that enhance fuel efficiency and reduce emissions. As the world shifts toward sustainable aviation, the company is strategically investing in next-generation propulsion systems, including electric and hybrid engines, positioning itself at the forefront...

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Financials
Annual
Quarterly
TTM
Annual
Quarterly
TTM

Balance Sheet Decomposition
Rolls-Royce Holdings PLC

Current Assets 19.4B
Cash & Short-Term Investments 4.3B
Receivables 7B
Other Current Assets 8.1B
Non-Current Assets 13.6B
Long-Term Investments 544m
PP&E 4.5B
Intangibles 4.4B
Other Non-Current Assets 4.2B
Current Liabilities 15.3B
Accounts Payable 2.2B
Accrued Liabilities 2B
Short-Term Debt 6m
Other Current Liabilities 11.1B
Non-Current Liabilities 20B
Long-Term Debt 4.8B
Other Non-Current Liabilities 15.2B
Efficiency

Earnings Waterfall
Rolls-Royce Holdings PLC

Revenue
17.8B GBP
Cost of Revenue
-13.8B GBP
Gross Profit
4.1B GBP
Operating Expenses
-1.4B GBP
Operating Income
2.6B GBP
Other Expenses
-299m GBP
Net Income
2.3B GBP

Free Cash Flow Analysis
Rolls-Royce Holdings PLC

Last Value
3-Years Average
FCF Margin
Conversion Rate
Earnings Calls

The company raised its 2023 operating profit guidance to ÂŁ1.2-1.4 billion from the previous ÂŁ0.8-1 billion, reflecting an anticipated improvement in targeted contract gains of ÂŁ200-250 million, including catch-ups and onerous provision releases. Free cash flow expectations were similarly elevated to ÂŁ0.9-1 billion, above the earlier ÂŁ0.6-0.8 billion estimate.

What is Earnings Call?
Fundamental Scores

RR Profitability Score
Profitability Due Diligence

Rolls-Royce Holdings PLC's profitability score is 41/100. The higher the profitability score, the more profitable the company is.

Positive 3-Years Revenue Growth
ROIC is Increasing
Positive Gross Profit
Positive Revenue Growth Forecast
41/100
Profitability
Score

Rolls-Royce Holdings PLC's profitability score is 41/100. The higher the profitability score, the more profitable the company is.

RR Solvency Score
Solvency Due Diligence

Rolls-Royce Holdings PLC's solvency score is 50/100. The higher the solvency score, the more solvent the company is.

Low D/E
Positive Net Debt
Short-Term Solvency
Long-Term Solvency
50/100
Solvency
Score

Rolls-Royce Holdings PLC's solvency score is 50/100. The higher the solvency score, the more solvent the company is.

Wall St
Price Targets

RR Price Targets Summary
Rolls-Royce Holdings PLC

Wall Street analysts forecast RR stock price to rise over the next 12 months.

According to Wall Street analysts, the average 1-year price target for RR is 546.08 GBX with a low forecast of 242.4 GBX and a high forecast of 708.75 GBX.

Lowest
Price Target
242.4 GBX
55% Downside
Average
Price Target
546.08 GBX
2% Upside
Highest
Price Target
708.75 GBX
32% Upside
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Dividends

Dividend Yield
Lowest
Average
Highest
Dividend Per Share
N/A
Growth 3Y
Growth 5Y
Growth 10Y
Dividend Safety Score
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0
25
50
75
100
Previous Payment
-
Today
Next Payment
-
Today
Oct 12, 2024
Previous Payment
-
Next Payment
-
Ex-Dividend Date
-
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Shareholder Yield

Current shareholder yield for RR is .

Shareholder yield represents the total return a company provides to its shareholders, calculated as the sum of dividend yield, buyback yield, and debt paydown yield. What is shareholder yield?

Shareholder Yield
Dividend Yield
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Buyback Yield
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Debt Paydown Yield
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Rolls-Royce Holdings PLC Logo
Rolls-Royce Holdings PLC

Country

United Kingdom

Industry

Aerospace & Defense

Market Cap

45.7B GBP

Dividend Yield

0%

Description

Rolls-Royce Holdings Plc designs, develops, manufactures, and services integrated power systems for use in the air, on land, and at sea. The firm is focused on power and propulsion systems. The Company’s segments include Civil Aerospace, Power Systems and Defence. Its Civil Aerospace is engaged in developing, manufacturing, marketing and sales of commercial aero engines and aftermarket services. Its Power Systems segment is engaged in developing, manufacturing, marketing and sales of reciprocating engines, power systems for civil power generation. Its Defence segment is engaged in developing, manufacturing, marketing and sales of military aero engines, naval engines and aftermarket services. The company delivers and services systems based on both gas and diesel engines and electrified hybrid systems. These solutions serve its customers in the marine and infrastructure sectors worldwide.

Contact

London
Kings Place, 90 York Way
+442072229020.0
www.rolls-royce.com

IPO

1987-05-20

Employees

44 000

Officers

See Also

Discover More
What is the Intrinsic Value of one RR stock?

The intrinsic value of one RR stock under the Base Case scenario is 385.34 GBX.

Is RR stock undervalued or overvalued?

Compared to the current market price of 537.2 GBX, Rolls-Royce Holdings PLC is Overvalued by 28%.

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