Rolls-Royce Shares: Analysts See Path to Ambitious 2028 Targets

Analysts grow bullish on Rolls-Royce as engine flying hours drive service revenue, supporting ambitious 2028 profit and cash flow goals. Stock has 27% upside potential.

Market sentiment toward Rolls-Royce is increasingly bullish, with a growing number of analysts convinced the engineering group can not only meet but potentially exceed its ambitious 2028 financial goals. This confidence is largely fueled by a previously underappreciated metric: engine flying hours.

The Foundation of Future Profits

The company has outlined specific targets for 2028, aiming for an operating profit between £4.9 billion and £5.2 billion. Concurrently, free cash flow is projected to reach £5.0 billion to £5.3 billion. A key driver for this anticipated performance is the ongoing recovery in long-haul air travel. As more wide-body aircraft take to the skies, the cumulative operating hours on Rolls-Royce engines rise, directly boosting the high-margin, long-term service agreements tied to them. The market is now beginning to price in these future service revenues more aggressively.

This expected earnings growth is leading analysts to forecast a compression of the stock's currently high price-to-earnings (P/E) ratio, which stands at approximately 30. The projection is for this multiple to fall to around 22 by 2028, driven primarily by rising profits rather than a declining share price.

Broad-Based Analyst Confidence

This optimistic outlook is reflected in recent analyst ratings. Of the 18 analysts covering the stock, 13 currently recommend buying the shares, while five advocate holding. The consensus average price target sits at 1,442.5 pence, implying an upside potential of roughly 27% from recent trading levels. Wells Fargo, which recently initiated coverage, has set a slightly more conservative target of 1,350 pence.

The broader market context has also provided support. On April 1, the FTSE 100 index advanced by 1.85%, buoyed by easing geopolitical tensions and a decline in oil prices to around $102 per barrel.

Sustaining Momentum is Key

Rolls-Royce shares, currently trading near €14, have staged a significant recovery from their low point in April 2025. Over a five-year horizon, the stock has delivered a staggering gain of approximately 950%. The critical question for the continued trajectory is whether the company can maintain its margin expansion as deliveries of new wide-body engines continue to increase. The interplay between rising production volumes and profitable aftermarket services will likely determine if the 2028 targets are fully realized.