Rolls-Royce H1 Results: Will the Share Price Rally Continue?

Rolls-Royce (LON: RR.) will report its first-half 2025 results on July 31, following a continued strong run for its shares, which are up over 75% year-to-date and more than 126% in the past 12 months. 

The stock has recently faced resistance around the 1,010p level, prompting investors to question whether the rally can continue. The current analyst consensus price target is 985.2p, suggesting around a 1.4% downside from current levels.

Market consensus for full-year 2025 points to 19.26 billion in revenue, £2.88 billion in underlying EBIT and £2.84 billion in free cash flow, with earnings per share forecast at 24.8p. 

Expectations for 2026 are even stronger, with revenue seen at £20.97 billion, EBIT projected at £3.32 billion, and EPS at 29.5p.

UBS remains upbeat, having recently maintained a “Buy” rating on the stock and raised its 12-month price target to 1,075p. 

The bank estimated that large engine flying hours in the first half were well above 2019 levels, but slightly below Rolls-Royce’s guidance. The bank also highlighted structural gains in pricing and engine efficiency improvements as key long-term drivers. 

UBS also sees upside in the defense division, noting current growth assumptions may be conservative given recent momentum.

CFRA, which reaffirmed its 900p price target in May, views the stock's premium valuation as justified, citing Rolls-Royce’s operational turnaround, robust FCF generation, and long-term growth catalysts. It maintained its EPS forecast of 24p for 2025.