London, March 13, 2026, 13:06 GMT
Shares of Rolls-Royce RR.L edged down 1.83% to roughly 1,260 pence as of 1303 GMT on Friday, shrugging off a fresh Moody’s upgrade to A3 from Baa1—a step up for the British engine maker’s credit standing.
This comes just two weeks after Rolls-Royce’s annual results pushed the stock to fresh highs. But the slower trading hints investors are looking for more than a turnaround stamp—they’re waiting for a new catalyst.
Rolls-Royce posted 2025 underlying operating profit at £3.5 billion on Feb. 26, with free cash flow—cash remaining after running and investment costs—coming in at £3.3 billion. Looking ahead to 2026, the company projected operating profit between £4.0 billion and £4.2 billion and free cash flow in the £3.6 billion-£3.8 billion range. Management also mapped out a £7 billion-£9 billion share buyback program for 2026 through 2028, including £2.5 billion to be returned to shareholders this year.
Chief executive Tufan Erginbilgic described the transformation as moving ahead “with pace and intensity”. Interactive Investor analyst Richard Hunter, talking to Reuters, called the February results “sparkling” and pointed out that Rolls-Royce still has “unfulfilled ambitions to maintain the momentum”. Rolls-Royce
Rolls-Royce claims its new mid-term margin goal matches GE Aerospace, the key competitor in the widebody engine space. Friday’s rating shift lands squarely in that rivalry, with investors now weighing if Rolls-Royce can continue narrowing the margin gap while handing back substantial cash.
Moody’s move on Friday bumps the group up another level, continuing its climb from the pandemic-era drop into junk status, or below investment grade. That’s a meaningful change for a manufacturer whose engines are built to run for decades, even if the stock barely flinched on the day.
The buyback has moved beyond headlines. According to London Stock Exchange notices, Rolls-Royce logged another own-share transaction on Friday—part of the capital return program outlined with its full-year results.
Still, the setup isn’t without its pitfalls. Rolls-Royce flagged a £150 million to £200 million drag on 2026 cash flow tied to supply-chain issues, while Reuters noted last month that the company is chasing an initial 100 million to 200 million pounds in UK support for its UltraFan 30 engine demo. If those headwinds stick around, rating lifts and buybacks alone might not be enough to push the shares back up to their late-February highs.
