One of Britain’s leading engineering and aerospace companies is up by 5.70% after reporting earnings and guidance that beat the market’s expectations. It gilded that lily with news of a £2.50 billion share buyback. The company said that based on its new, more bullish outlook, it now expects to hit its mid term guidance targets two years earlier than anticipated.

Rolls-Royce now expects to report operating profits of between £4.90 and £5.20 billion in 2028, with operating profit margins of between 18.0 and 20.0% and free cash flow ranging between £5.0 and £5.30 billion.

Today’s news has taken the stock to a new all-time high of £14.20. Momentum has certainly been with the stock in recent times; for example, it’s posted 99 new 2-year highs and added +282.34% to its share price.

CEO Tufan Erginbilic aimed to make Rolls-Royce leaner, far more cost-effective, and capital-efficient. And it would seem that he is achieving that. and doing so ahead of schedule.

There was always the potential for those efficiencies to show themselves, in both the top and bottom lines and if the business can drive additional volumes from existing products and new businesses such as SMRS,

Then there is tremendous scope for shareholder gains and additional returns, much will depend on the macroeconomic background and geopolitics, but if the company can successfully negotiate the turbulence as well as it has done in recent years, then there is room for continued optimism.