Safran (EPA: SAF) share price has been in a strong uptrend in the past few months. The stock has risen in the past nine consecutive weeks and is sitting at its all-time high. It has surged by more than 290% from its lowest point during the pandemic.
Industrial stocks are soaringSafran and other industrial companies are doing well. In the UK, the Rolls-Royce stock price has surged by over 700% from its pandemic low. Similarly, in the United States, General Electric has soared by over 388% from its pandemic lows.
These companies are doing well, helped by the strong performance of the aviation and defense industry. That’s because Safran, Rolls-Royce, and General Electric are some of the biggest engine providers in the world.
The three firm are also major defence contractors at a time when countries are boosting their defence budgets.
Safran reported strong financial results recently. Its total revenue rose to over €10.94 billion in the first half of the year, up from €8.56 billion in the previous year. Most of this revenue came from its propulsion business whose revenue rose by 35% to €5.6 billion.
It was followed by the equipment and defence business whose revenue rose by 16.9% to €4.1 billion. Its aircraft interiors revenue also jumped from over €870 million to over €1.1 billion.
Safran also believes that the business will continue booming this year. It expects that its full-year revenue will be €23 billion while its free cash flow will be €2.7 billion.
Therefore, the company will likely continue doing well in the coming months unless something bad happens in the industry. This explains why Safran is the best-performing companies in the CAC 40 index this year.
The other top-performing companies in the index are Hermes, Capgemini, Stellantis, Schneider Electric, and Publicis.
Safran share price forecast
The weekly chart shows that the SAF stock price has been in a strong uptrend for a while. It crossed the important resistance point at €148.98, its highest point in 2019. The stock has continued rising above the 100-week and 50-week moving averages.
Further, the Relative Strength Index (RSI) has moved to the extremely overbought point over 84. The Percentage Price Oscillator (PPO) has also remained above the neutral point since 2022, which is a positive sign.
Therefore, while the stock’s trend is positive, there is a likelihood that it will retreat in the coming weeks. If this happens, it could retest the support at €180 and then resume the bullish trend.
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