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Rolls-Royce (RR.) Shares Are Up 12.5% This Year. Will This Last?

Simon Mugo trader
Updated 13 Jan 2023

The Rolls-Royce Holdings PLC (LON: RR) share price has risen 12.49% so far this year, bringing its gains over the past three months to 49.45%. The company has been on a roll since October  2022 and recently broke above the £1 price.

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The last time RR stock traded above £1 was in April 2022 as part of a downtrend that began in November 2021 when the stock was trading at £1.49. However, the company’s recent rally has left many wondering whether this is the beginning of a new uptrend.

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First, we must clarify that the Rolls-Royce company we are talking about is a manufacturer of power systems, aircraft engines and defence systems. The company is separate from the Rolls Royce car brand, owned by BMW and not listed. 

Rolls-Royce shares plunged lower in early 2020 after the COVID-19 pandemic, bringing global air travel to a halt. The company manufactures engines for wide-body aircraft, mainly used for long-haul intercontinental flights.

The company did not immediately benefit from the resumption of airline flights in 2021 and 2022, as long-haul flights took longer to recover due to the restrictions imposed by most countries on passengers arriving from other countries. 

However, it seems that investors are now more confident in the company following the appointment of a new CEO, Tufan Erginbilgic, on 1 January 2023. Many hope the company’s shares will keep rising under the new CEO. 

The recent relaxation of the strict COVID-19 rules in China might trigger the rally in RR. shares, given that the country contributes to a significant percentage of global air travel due to its position as the world’s factory. 

The company has implemented a massive cost-cutting programme to shore up its finances, combined with a £2 billion rights issues and asset sales worth another £2 billion. However, the firm still has a substantial debt burden. 

Overall, it remains to be seen whether Rolls-Royce shares will keep rising, given the optimistic outlook for the global airline industry. 

*This is not investment advice. 

Rolls-Royce (RR) share price. 

The Rolls Royce share price has risen 12.49% this year and is up 49.45% over the past three months.


YOUR CAPITAL IS AT RISK. 81% OF RETAIL CFD ACCOUNTS LOSE MONEY.


Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading