Rolls-Royce Holdings (LSE: RR.) shares are only a little way down from the all-time high they reached in late June. And they got an extra 4% boost early Thursday (30 July) after the company did it again.

Rolls smashed through expectations on first-half results day, with a 46% jump in operating profit, and raised its full-year guidance even higher.

All divisions growing

Higher profitability came from all of Rolls-Royce’s divisions, as the boss told us:

Our transformation continues to deliver, and we are demonstrating that Rolls-Royce is now a very different company to that of the past… with three strong businesses that can respond to changes in the external environment with agility and pace.

CEO Tufan Erginbilgic, H1 results

He’s putting the “very different” thing mildly. Compared to those painful times in 2020, we see it truly transformed today. It’ll probably go down in history as a case study for how to turn round a struggling company.

Looking ahead to the full year, the CEO added: “We now expect to deliver underlying operating profit of £4.7-£4.9bn and free cash flow of £3.8-£4bn.”

Full-year targets in sight

If anything, I’d say those estimates might still be conservative. Operating profit in the half already reached £2.5bn, with free cash flow hitting the £2bn mark.

But that’s the way great companies so often do it. They under-promise and over-deliver. And I like that a lot better than the ‘aim for the stars and hope’ strategy that appears to be facing Space Exploration Technologies (SpaceX) shareholders right now.

Speaking of cash, Rolls announced an interim dividend of 6p per share. And it’s completed £1.4bn of the planned £2.5bn share buyback for 2026. The company’s on track for planned buybacks of £7bn-£9bn over 2026-2028.

While we’re looking at dividend yields of less than 1% today, I see plenty of scope for progressive rises. Rolls still had £2.1bn net cash on the books at the end of June, even after all those share repurchases. And forecasts show that continuing to grow strongly.

What could possibly go wrong?

Rolls is enjoying something of a defence boost right now. And the company did say it’s “effectively eliminated aircraft on ground“, so the damage to civil aviation from today’s conflict’s seems manageable.

I really do see a great company firing on all cylinders here. And that’s boosted by something else the CEO said: “Following its recent win in Sweden, Rolls‑Royce SMR has now been successful in every competitive European nuclear tender and is uniquely positioned to become a global market leader.”

I just see much of the potential already built into Rolls-Royce shares for me to buy. There isn’t the safety margin I want as a relatively risk-averse investor, and the danger of share price falls is too great.

But for more risk-tolerant investors considering buying, I really can see a strong possibility of further gains in the years ahead. Rolls-Royce might not be for me, but I do have my eye on a few other great candidates out there…

Should you invest £5,000 in Rolls-Royce Plc right now?

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Alan Oscroft does not hold any positions in the companies mentioned.