Citi lifts Rolls-Royce price target after CMD
Sharecast – The bank said its earnings per share forecasts were up 27% in the near term and 52% in the long term, and the target price lifted, driven by “very strong” cash generation.
“In the near term, we believe cash flow will be helped by working capital unwind, but expect the medium term FCF of well over 30p per share (31p in 2025 rising to 38p in 2028) will be sustainable and should be valued accordingly,” Citi said.
“Modelling of the net LTSA creditors shows continued growth in the £0.8-1.2bn per year range, driven by fleet growth, but also taking into account of increasing engine overhauls (good for profit, bad for cash).”
At 1010 GMT, the shares were up 1.8% at 294.50p.
