Rolls-Royce Holdings plc
Rolls-Royce Holdings plc Fundamental Analysis
Rolls-Royce Holdings plc (RRU.DE) shows moderate financial fundamentals with a PE ratio of 18.44, profit margin of 27.54%, and ROE of 2.28%. The company generates $21.3B in annual revenue with strong year-over-year growth of 14.70%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 60.3/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze RRU.DE's fundamental strength across five key dimensions:
Efficiency Score
ExcellentRRU.DE demonstrates superior asset utilization.
Valuation Score
ExcellentRRU.DE trades at attractive valuation levels.
Growth Score
ModerateRRU.DE shows steady but slowing expansion.
Financial Health Score
ModerateRRU.DE shows balanced financial health with some risks.
Profitability Score
ExcellentRRU.DE achieves industry-leading margins.
Key Financial Metrics
Is RRU.DE Expensive or Cheap?
P/E Ratio
RRU.DE trades at 18.44 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, RRU.DE's PEG of 0.21 indicates potential undervaluation.
Price to Book
The market values Rolls-Royce Holdings plc at 39.50 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 19.25 times EBITDA. This signals the market has high growth expectations.
How Well Does RRU.DE Make Money?
Net Profit Margin
For every $100 in sales, Rolls-Royce Holdings plc keeps $27.54 as profit after all expenses.
Operating Margin
Core operations generate 25.09 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $2.28 in profit for every $100 of shareholder equity.
ROA
Rolls-Royce Holdings plc generates $15.32 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Rolls-Royce Holdings plc produces operating cash flow of $4.50B, showing steady but balanced cash generation.
Free Cash Flow
Rolls-Royce Holdings plc generates strong free cash flow of $3.87B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $0.46 in free cash annually.
FCF Yield
RRU.DE converts 3.56% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
18.44
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.21
vs 25 benchmark
P/B Ratio
Price to book value ratio
39.50
vs 25 benchmark
P/S Ratio
Price to sales ratio
5.09
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.57
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.11
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
2.28
vs 25 benchmark
ROA
Return on assets percentage
0.15
vs 25 benchmark
ROCE
Return on capital employed
0.28
vs 25 benchmark
How RRU.DE Stacks Against Its Sector Peers
| Metric | RRU.DE Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 18.44 | 25.83 | Better (Cheaper) |
| ROE | 227.50% | 1282.00% | Weak |
| Net Margin | 27.54% | -49099.00% (disorted) | Strong |
| Debt/Equity | 1.57 | 0.79 | Weak (High Leverage) |
| Current Ratio | 1.11 | 10.63 | Neutral |
| ROA | 15.32% | -1538239.00% (disorted) | Strong |
RRU.DE outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Rolls-Royce Holdings plc's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-24.60%
Industry Style: Cyclical, Value, Infrastructure
DecliningEPS CAGR
227.19%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
8.90%
Industry Style: Cyclical, Value, Infrastructure
Growing