ROLLS-ROYCE HOLDINGS PLC (RRU.DE) Stock Fundamental Analysis
Europe - FRA:RRU - GB00B63H8491 - Common Stock
13.78 EUR
-0.04 (-0.29%)
Overall RRU gets a fundamental rating of 6 out of 10. We evaluated RRU against 43 industry peers in the Aerospace & Defense industry. While RRU has a great profitability rating, there are some minor concerns on its financial health. RRU is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make RRU a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
RRU had positive earnings in the past year.
RRU had a positive operating cash flow in the past year.
In multiple years RRU reported negative net income over the last 5 years.
The reported operating cash flow has been mixed in the past 5 years: RRU reported negative operating cash flow in multiple years.
1.2 Ratios
RRU's Return On Assets of 15.26% is amongst the best of the industry. RRU outperforms 97.67% of its industry peers.
RRU's Return On Equity of 240.37% is amongst the best of the industry. RRU outperforms 100.00% of its industry peers.
RRU's Return On Invested Capital of 11.49% is fine compared to the rest of the industry. RRU outperforms 69.77% of its industry peers.
RRU had an Average Return On Invested Capital over the past 3 years of 6.58%. This is below the industry average of 9.61%.
The last Return On Invested Capital (11.49%) for RRU is above the 3 year average (6.58%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 240.37% | ||
| ROIC | 11.49% |
ROA(3y)3.47%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)6.58%
ROIC(5y)N/A
1.3 Margins
With an excellent Profit Margin value of 29.62%, RRU belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Profit Margin of RRU has grown nicely.
The Operating Margin of RRU (16.47%) is better than 90.70% of its industry peers.
RRU's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 25.80%, RRU perfoms like the industry average, outperforming 44.19% of the companies in the same industry.
In the last couple of years the Gross Margin of RRU has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.47% | ||
| PM (TTM) | 29.62% | ||
| GM | 25.8% |
OM growth 3Y43.46%
OM growth 5YN/A
PM growth 3Y131.85%
PM growth 5YN/A
GM growth 3Y5.44%
GM growth 5Y31.49%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), RRU is creating some value.
The number of shares outstanding for RRU has been increased compared to 1 year ago.
The number of shares outstanding for RRU has been increased compared to 5 years ago.
Compared to 1 year ago, RRU has an improved debt to assets ratio.
2.2 Solvency
RRU has an Altman-Z score of 2.66. This is not the best score and indicates that RRU is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.66, RRU is in line with its industry, outperforming 53.49% of the companies in the same industry.
RRU has a debt to FCF ratio of 1.55. This is a very positive value and a sign of high solvency as it would only need 1.55 years to pay back of all of its debts.
The Debt to FCF ratio of RRU (1.55) is better than 83.72% of its industry peers.
A Debt/Equity ratio of 1.18 is on the high side and indicates that RRU has dependencies on debt financing.
With a Debt to Equity ratio value of 1.18, RRU is not doing good in the industry: 74.42% of the companies in the same industry are doing better.
Although RRU does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.55 | ||
| Altman-Z | 2.66 |
ROIC/WACC1.27
WACC9.03%
2.3 Liquidity
A Current Ratio of 1.24 indicates that RRU should not have too much problems paying its short term obligations.
RRU has a better Current ratio (1.24) than 60.47% of its industry peers.
A Quick Ratio of 0.93 indicates that RRU may have some problems paying its short term obligations.
The Quick ratio of RRU (0.93) is better than 72.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
RRU shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 51.97%, which is quite impressive.
RRU shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.95% yearly.
RRU shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.62%.
Measured over the past years, RRU shows a small growth in Revenue. The Revenue has been growing by 2.66% on average per year.
EPS 1Y (TTM)51.97%
EPS 3Y468.12%
EPS 5Y29.95%
EPS Q2Q%75.87%
Revenue 1Y (TTM)9.62%
Revenue growth 3Y19.01%
Revenue growth 5Y2.66%
Sales Q2Q%10.69%
3.2 Future
Based on estimates for the next years, RRU will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.06% on average per year.
Based on estimates for the next years, RRU will show a quite strong growth in Revenue. The Revenue will grow by 9.15% on average per year.
EPS Next Y41.44%
EPS Next 2Y26.52%
EPS Next 3Y21.67%
EPS Next 5Y19.06%
Revenue Next Year13.69%
Revenue Next 2Y11.77%
Revenue Next 3Y10.54%
Revenue Next 5Y9.15%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 44.45, the valuation of RRU can be described as expensive.
The rest of the industry has a similar Price/Earnings ratio as RRU.
RRU is valuated expensively when we compare the Price/Earnings ratio to 27.86, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 37.22 indicates a quite expensive valuation of RRU.
RRU's Price/Forward Earnings ratio is in line with the industry average.
RRU's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 23.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.45 | ||
| Fwd PE | 37.22 |
4.2 Price Multiples
RRU's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of RRU indicates a somewhat cheap valuation: RRU is cheaper than 67.44% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.91 | ||
| EV/EBITDA | 24.42 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of RRU may justify a higher PE ratio.
RRU's earnings are expected to grow with 21.67% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.07
PEG (5Y)1.48
EPS Next 2Y26.52%
EPS Next 3Y21.67%
5. Dividend
5.1 Amount
With a yearly dividend of 0.89%, RRU is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.27, RRU has a dividend in line with its industry peers.
With a Dividend Yield of 0.89, RRU pays less dividend than the S&P500 average, which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.89% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y26.52%
EPS Next 3Y21.67%
FRA:RRU (10/2/2025, 7:00:00 PM)
13.78
-0.04 (-0.29%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners69.95%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap116.15B
Analysts79.13
Price Target12.93 (-6.17%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.89% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)4.36%
PT rev (3m)25.62%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)5.67%
EPS NY rev (3m)14.83%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.41%
Revenue NY rev (3m)2.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 44.45 | ||
| Fwd PE | 37.22 | ||
| P/S | 5.18 | ||
| P/FCF | 31.91 | ||
| P/OCF | 24.52 | ||
| P/B | 42.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 24.42 |
EPS(TTM)0.31
EY2.25%
EPS(NY)0.37
Fwd EY2.69%
FCF(TTM)0.43
FCFY3.13%
OCF(TTM)0.56
OCFY4.08%
SpS2.66
BVpS0.33
TBVpS-0.28
PEG (NY)1.07
PEG (5Y)1.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.26% | ||
| ROE | 240.37% | ||
| ROCE | 16.32% | ||
| ROIC | 11.49% | ||
| ROICexc | 16.56% | ||
| ROICexgc | 24.65% | ||
| OM | 16.47% | ||
| PM (TTM) | 29.62% | ||
| GM | 25.8% | ||
| FCFM | 16.25% |
ROA(3y)3.47%
ROA(5y)0.02%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)6.58%
ROIC(5y)N/A
ROICexc(3y)8.59%
ROICexc(5y)N/A
ROICexgc(3y)12.54%
ROICexgc(5y)N/A
ROCE(3y)9.36%
ROCE(5y)N/A
ROICexcg growth 3Y80.93%
ROICexcg growth 5YN/A
ROICexc growth 3Y76.35%
ROICexc growth 5YN/A
OM growth 3Y43.46%
OM growth 5YN/A
PM growth 3Y131.85%
PM growth 5YN/A
GM growth 3Y5.44%
GM growth 5Y31.49%
F-Score5
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.18 | ||
| Debt/FCF | 1.55 | ||
| Debt/EBITDA | 0.69 | ||
| Cap/Depr | 108.38% | ||
| Cap/Sales | 4.9% | ||
| Interest Coverage | 11.83 | ||
| Cash Conversion | 100.73% | ||
| Profit Quality | 54.84% | ||
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.93 | ||
| Altman-Z | 2.66 |
F-Score5
WACC9.03%
ROIC/WACC1.27
Cap/Depr(3y)78.15%
Cap/Depr(5y)65.71%
Cap/Sales(3y)4.47%
Cap/Sales(5y)5.33%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)51.97%
EPS 3Y468.12%
EPS 5Y29.95%
EPS Q2Q%75.87%
EPS Next Y41.44%
EPS Next 2Y26.52%
EPS Next 3Y21.67%
EPS Next 5Y19.06%
Revenue 1Y (TTM)9.62%
Revenue growth 3Y19.01%
Revenue growth 5Y2.66%
Sales Q2Q%10.69%
Revenue Next Year13.69%
Revenue Next 2Y11.77%
Revenue Next 3Y10.54%
Revenue Next 5Y9.15%
EBIT growth 1Y45.09%
EBIT growth 3Y70.73%
EBIT growth 5YN/A
EBIT Next Year76.87%
EBIT Next 3Y27.64%
EBIT Next 5Y20.92%
FCF growth 1Y85.51%
FCF growth 3YN/A
FCF growth 5Y26.05%
OCF growth 1Y72.99%
OCF growth 3YN/A
OCF growth 5Y10.49%