Singapore - February 4, 2018: The Rolls-Royce Trent XWB engine of an Airbus A350-1000 XWB in Airbus factory livery during Singapore Airshow at Changi Exhibition Centre in Singapore.
The Rolls-Royce share price has been under pressure for most of the year, losing 25 per cent of its value year to date. However, a recent market resurgence is posing the question of whether a Rolls-Royce share price revival is in the offing, with most fundamentals and technical views of the company screaming for a buy.
In the past few weeks, Rolls-Royce has partnered with companies such as EasyJet and VietJet, as it continues looking for new markets. According to reports, the partnership with EasyJet will see the company test its hydrogen combustion engine technology, which it considers the future of aviation. The report indicates the main goal of the collaboration is to demonstrate that hydrogen has the potential to power a range of aircraft going into the 2030s.
The partnership with Vietjet will see the company support Vietjet’s fleet of A330ceos with its Trent 700 TotalCare engine package. The partnership is a net positive for Vietjet, as it ensures that Rolls-Royce covers its engine off-wing repair and overhaul services. The partnership will also benefit Rolls-Royce’s continued expansion in the Asian markets.
The two partnerships, the expected 2023 unveiling of its first electric car, and the improving financial prospects of the company paint a positive picture of where the company is headed. Despite being down by a quarter of its value since the year started, the developments also indicate that the share price may be becoming highly undervalued, an indication of the company’s being in a good position to continue rising in the markets.
Looking at the chart below, July has been aggressively bullish. Since setting a monthly low of 79p early in July, the prices have continued an aggressive push to the upside, which has seen it rise to the current price of 91p, a 16 per cent increase during that time.
The chart also shows that, despite the price slowing in the past few days, where it has traded in a sideways market, there is a high likelihood that we may see price trading above the 94 price level. Furthermore, there is also a high likelihood we may see prices trading above the 100p price level in the next few trading sessions. Therefore, my analysis will be invalidated only when prices drop below 85.
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