Rolls-Royce hits £100bn valuation in turnaround hailed as one of Britain's most remarkable industrial revivals
Stock surge under CEO Tufan Erginbilgic echoes a dramatic recovery fueled by post‑pandemic demand and new energy bets
Rolls-Royce surged to a £100 billion valuation for the first time, with shares touching as high as 1,190 pence and lifting the company's market value to about £100.3 billion. Goldman Sachs analysts have a 1,290p price target, roughly 8% above current levels. The stock has jumped nearly 1,200% since Tufan Erginbilgic took over as chief executive at the start of 2023, when shares were 93.2p and the market value was about £7.9 billion. The turnround has helped lift Rolls-Royce into the top tier of the FTSE 100, making it among the five biggest names in the index.
The performance marks one of the most remarkable corporate turnarounds in modern British industry, according to market observers and the company. Erginbilgic, a former BP executive nicknamed 'Turbo' Tufan, has pushed through a sweeping overhaul after describing Rolls-Royce as a 'burning platform' following the pandemic's blow to air travel. In his first year, he cut jobs and restructured costs, aiming to lift profits and cash flow. The firm weathered the pandemic hit and is now benefiting from a rebound in air travel, defence spending, and servitization of engines. The period described by executives as its 'darkest hour' since the 1970s involved losses, emergency fundraising, and fragile investor confidence.
Rolls-Royce generates revenue from its civil aerospace engines, including power-by-the-hour service contracts tied to engine usage, and from military engines for fighters such as the Eurofighter Typhoon and F-35. The group also produces nuclear reactors to power Royal Navy submarines and has positioned itself at the heart of Britain’s energy transition with involvement in the UK’s Small Modular Reactor program, which is expected to become cash-flow positive by 2030. The post-pandemic rebound in international travel, together with a global uptick in defence spending in Europe amid Russia's aggression, have supported demand for new engines and engine maintenance.
Among the 18 analysts covering Rolls-Royce, four rate the shares as a strong buy, nine say buy, four hold, and one recommends selling. Goldman Sachs’ 1,290p target implies upside of about 8% from current levels. An investor who put £1,000 into Rolls-Royce when Erginbilgic took the helm would be sitting on more than £12,700 now, according to market watchers. Richard Hunter, head of markets at Interactive Investor, called the turnaround extraordinary, saying the company has moved from a crisis-era 'burning platform' to a business now operating with what he described as a turbocharged pace and focus on performance.
The valuation lift has catapulted Rolls-Royce up the FTSE 100, placing it among the five biggest constituents by market cap. The rally reflects investor confidence that the company can sustain growth through a mix of civil engine services, defence work, and strategic bets in nuclear power and data-center-related technologies. While legacy engine issues and supply chain pressures remain, the market is betting on a new era of profitability under Erginbilgic’s leadership.
Looking ahead, Rolls-Royce continues to pursue growth in newer areas such as data-center power systems and its nuclear ambitions, with the UK’s Small Modular Reactor program highlighted as a key potential cash-flow driver by 2030. The company has flagged ongoing challenges in engine reliability and supply chains but remains focused on delivering higher returns by 2027, the timeline Erginbilgic set out for quadrupling profits. Investors will be watching for further signs of dividend resilience, free cash flow growth, and a stable order book as the company seeks to maintain momentum in a market shaped by post-pandemic travel demand and renewed defence spending.
Rolls-Royce’s turnround has also altered perceptions of UK manufacturing resilience, with the group now seen as a bellwether for large-cap industrials that can pivot from crisis to growth through disciplined cost control and strategic bets in high-margin services and technology. The company’s renewed emphasis on data-centric maintenance, propulsion efficiency, and a broader energy footprint aligns with policy priorities around rearmament and energy security across Europe. Analysts say the combination of a stronger backlog, improved profitability per engine, and ongoing cost discipline could sustain the gains into 2025 and beyond, though execution risks in complex aerospace programs remain.
The stock’s ascent has helped Rolls-Royce ascend toward the upper echelons of the FTSE 100, reinforcing confidence in a company that has rebounded from a pandemic-era trough to a more diversified, services-led engine business. The market is watching whether the company can translate demand into durable earnings growth, particularly as it expands into nuclear projects and power systems for data centers, areas that could provide steadier cash flow than traditional engine manufacturing alone.
