(News Bulletin 247) – UBS on Wednesday raised its recommendation on the Rolls-Royce stock, raised from ‘neutral’ to ‘buy’ due to a valuation deemed ‘abnormally cheap’ in view of the reopening of the Chinese economy .
The broker points out that with 51% of world traffic, the wide-body aircraft market is mainly driven by Asia, and especially by China.
From this point of view, the reopening of the Chinese economy constitutes, according to UBS, a major and undervalued catalyst for a revaluation of the stock, which is now trading below its historical averages.
The broker specifies that it has therefore almost doubled its target price, which goes from 105 to 200 pence.
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