Sumary of 5 reasons to buy Rolls-Royce shares – and why I’m not:
- The Rolls-Royce (LSE: RR) share price has had a bumpy ride over the past year.
- While it is flat relative to its price a year ago, in the interim it has sunk to 39p and reached as high as 135p.
- With Rolls-Royce shares now in penny stock territory, here are five reasons I’d consider buying the company today – and why I have still not decided to purchase just yet.
- 1. Civil aviation demand is returning One of the key drivers for the decline in the Rolls-Royce share price since the pandemic began has been its exposure to civil aviation.
- If that continues, it should improve the outlook for the civil aviation business – and Rolls-Royce shares.
- 2. The defence business is resilient Civil aviation is not the only part of Rolls-Royce’s business.
- The defence business also grew its underlying operating profit to £448m – the biggest of any Rolls-Royce division.
- 3. Cost cutting should show benefits Part of the company’s plan last year to combat the impact of falling business was to strip costs out of the business.