Is this the end of Rolls-Royce’s share price rise? And Invezz

The Rolls-Royce Holdings (LON:LON:) share price has fallen in recent days as the global stock rally has faded. It fell to a low of 391p this month, down sharply from a year high of 434p. However, despite this influence, the stock remains 1,060% above its 2020 low. This is also the first monthly decline since last November.

Expected results from GE and Saffron (EPA:)

Rolls-Royce Holdings has surged in recent years as investors applauded the performance of its core segments such as aerospace, defense and energy.

Its aviation division, which accounts for more than 50% of its total revenue, has grown rapidly in recent years as international travel has increased. Most airlines reported significant revenue growth as load factor increased.

The Department of Defense is benefiting from the increasing geopolitical problems in the world. Ukraine continues its struggle against Russia while Israel is fighting a fierce war against Hamas.

There are indications that AUKUS cooperation will expand and that Japan is close to joining. This is an important development as Rolls-Royce Holdings is a major military contractor.

At the same time, management has implemented ambitious sales and profit targets. As part of these changes, management plans to increase its operating margin in the aerospace division to between 15% and 17% compared to the current 11.6%.

It also intends to increase its defense rate from 13.8% to between 14 and 16% and its energy share from 10.4% to 12% and 14%. To achieve this, the company abandons some of its less profitable activities and uses new structures such as joint ventures.

For example, instead of creating a separate thin-body engine business, the company hopes to enter into a partnership. It also hopes to sell its advanced electric air mobility business.

Looking ahead, Rolls-Royce is not expected to issue any reports on market developments anytime soon. The most likely boosters for the stock will be upcoming road shows in Toronto, Chicago and Denver. It will then release its financial results in August.

A possible driver of RR’s share price will be the financial performance of its competitors. GE Aviation will release its results on Tuesday while Safran will release its results on April 26.

Rolls-Royce stock price forecast

RR Chart by TradingView

Rolls Royce’s share price has fallen in recent weeks, possibly due to profit-taking and rising industrial ore prices. These restrictions are common when the item is in positive orientation. It remained above all moving averages.

It is still above the key support level of 380.2p, its volatility from July 30, 2018. The relative strength index (RSI) has retreated from the overbought level of 92 to 76. Additionally, the Percent price oscillator ( PPO) has moved above the neutral point.

Therefore, the outlook for the stock remains positive, with an initial target of 443p, an all-time high. Before that happens, it will likely retest the necessary level of support at 380p in a process called pause and retest.

This article first appeared on Invezz.com France