Citi lifts target price for Rolls-Royce as rally continues

RR's shares have gained nearly 12% over the past month alone, taking its year-to-date gain to 62% and its 12-month gain to an eye-watering 207%.

"Rolls-Royce shares have done well, but we believe there remains sufficient upside to keep our 'buy' recommendation as we increase our target price to 555p" said Citi analysts Charles Armitage and Sam Burgess.

"Moreover, we believe positive sentiment will help the continued rerating, driven by accelerating wide body cycle (only a few delivery slots before 2030 for the A350 and 2028 for the A330) and our expectation of the reinstatement of the dividend (possibly at H1 results or at the full year)."

Rolls-Royce's results for the first half ending 30 June will be published on 1 August.

Despite the positive comments from Citi, shares were down 0.5% at 483p by 0854 BST.