We’ve seen one of the most stunning turnarounds for British blue chip stocks in the last decade Rolls-Royce (LSE:RR). The Rolls-Royce share price is 858% higher today than it was five years ago.

At the beginning of 2025, this rate had already been maintained for several years. But that momentum continues, with the share price up three-quarters this year.

However, in the weeks since tardy October, Rolls-Royce’s share price has fallen by 12%.

Could this just be a blip? Or does this mean its glory days are over?

Good business results

If Rolls-Royce’s stock had soared while the company’s fortunes had gone sideways or even down, I would say that a share price augment of something like 858% would make no sense. The reality, however, is that Rolls is in a very different and better place today than it was five years ago.

This is partly due to the changing environment. Demand for civil aviation has surged in the wake of the pandemic, defense spending has skyrocketed since Russia went to war in Ukraine, and demand for power generation equipment is robust.

But Rolls also deserves a lot of credit. It has cut debt, restored its dividend, cut many operating costs, and is pursuing its goals with a reliability that few would have expected five years ago.

The valuation doesn’t seem unreasonable

So while the share price has increased, earnings have also changed. Currently, Rolls-Royce’s share price to earnings ratio is 15. That doesn’t seem unreasonable to me.

I don’t think this amount is an exorbitant bargain, but I don’t think it’s unreasonably high either. After all, Rolls has an established brand and a huge customer base in an industry that benefits from high barriers to entry and high prices.

Is investor sentiment cooling?

Despite this, Rolls-Royce’s share price has declined significantly over the past few weeks.

Could this mean a reversal of fortunes? A trading update from earlier this month may hold a clue.

The company maintained its full-year financial forecast, which is positive. However, the update included one point that may give investors food for thought. Mentioned “constant challenges in the supply chainIf this happens, they can harm production schedules and eat into profits.

Otherwise, the statement was decidedly confident.

Supply chain challenges for Rolls and many other companies have been common knowledge this year. Could this alone explain the recent decline in share prices?

I’m on the sidelines

I don’t think so. Rolls seems to be doing well. From the updates, business appears to be on track.

An alternative explanation for the recent decline in Rolls-Royce share prices is simply that after years of robust momentum, investors are losing enthusiasm for the growth story.

In this case, the price may continue to fall even in the absence of any significant news.

For now, I have no plans to buy shares.