Rolls-Royce Holdings PLC (LSE:RR.) was given a higher share price target by Citigroup as it updated forecasts for the engine maker.
Analysts at the investment bank updated their numbers to take into account the slower traffic recovery and better 2021 cash flow following the trading statement in early December.
They said their long term 'buy' thesis "remains intact" and the target price has been increased to 177p from 157p, "mainly due to time value of money in our DCF and FX".
The stock "remains high risk, in our view", the analysts said while the air traffic recovery remains uncertain and based on the expectation that wide body traffic will recover later than narrow bodies.
"However, we do believe the cash generation will return with air traffic and see significant upside to the current valuation."