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The Rolls-Royce share worth dominated headlines this week because the aerospace engineer hit a brand new document worth. On Tuesday (10 June), it surged to 912p per share, 4.6% increased than the day prior to this.
The shares at the moment are up 56.3% this 12 months – however they’re not alone in driving the FTSE 100 to new highs. Three shares have carried out even higher in 2025, with two greater than doubling in worth.
Might these shares observe within the footsteps of Rolls and maintain climbing — or is the rally tapped out?
BAE Programs
BAE Programs (LSE: BA.) has been using the identical tailwinds as Rolls, having fun with progress on elevated defence spending, with the shares up over 62% prior to now 12 months. With defence budgets increasing throughout Europe and past, demand for BAE’s navy tech isn’t slowing.
Its revenue credentials stand out too. Whereas the present dividend yield is a modest 1.76%, BAE has raised its payout persistently for 19 years, averaging 10% annual progress. For long-term buyers centered on reliability, this sort of observe document is gold.
It’s additionally a textbook defensive inventory. When economies wobble, authorities defence spending usually doesn’t — and that’s a robust buffer. Nevertheless, geopolitical threat cuts each methods. Whereas conflict drives demand, the sudden peace all of us need or coverage shifts can derail expectations. Plus, valuations are beginning to look wealthy.
Nonetheless, BAE stays a stable inventory to think about for its sturdy mixture of revenue, progress and stability in unsure instances.
Babcock Worldwide
It’s uncommon for a FTSE 100 inventory to greater than double in a 12 months, however Babcock Worldwide (LSE: BAB) has completed precisely that — up almost 109% in 2025 alone. The engineering and defence companies agency has been on a turnaround path since its restructuring, and buyers appear to be betting on a long-term revival.
Its fundamentals look encouraging. A return on fairness (ROE) of 44% is eye-catching, particularly in comparison with others within the business. And with a price-to-earnings progress (PEG) ratio of 0.05, it stays undervalued with a good stability sheet — not good, however removed from regarding.
Nevertheless, the latest surge could also be working on loads of optimism. Margins stay skinny and execution threat is actual. If operational points resurface, the positive factors might disappear once more rapidly – particularly if defence spending drops off.
Happily, Babcock has secured a string of presidency contracts and is increasing its presence in nuclear and submarine upkeep. These extremely specialised, sticky areas are inclined to generate regular income, giving the inventory long-term progress potential that’s price contemplating.
Fresnillo
Fresnillo (LSE: FRES) has been the standout performer of the FTSE 100 this 12 months, surging 122%. As gold and silver costs climb, buyers have poured into this Mexico-based treasured metals miner.
Momentum apart, there’s a giant pink flag – its present price-to-earnings (P/E) ratio is a staggeringly excessive 92.6. That type of valuation calls for both spectacular earnings progress or continued commodity tailwinds. With out one or each, a correction could also be inevitable.
That mentioned, gold usually shines brightest when markets flip fearful. If inflation lingers or central banks keep cautious, treasured metals might stay in demand
Nonetheless, it’s arduous to disregard how costly the shares have develop into. The expansion potential from right here could also be restricted except the gold bull run continues. Threat-tolerant buyers may nonetheless see worth, however after such a steep climb, I contemplate the inventory too dear for me proper now.
