Does this Upgrade present an opportunity for you?

Is it irrelevant, or will the Upgrade make Centrica’s share price attractive?

• The chart shows Centrica’s share price movements over the past 2 months
• Goldman Sachs has upgraded Centrica to a Buy rating overnight, with a target price at 176p
• Consensus summary: 9 Buys, 6 Holds, 4 Sells; Average target: 160.5p (Source: Bloomberg)
• Current share price is 148p (at time of writing)
• Will the shares turn back, or will the upgrade push the shares back towards 164p Jul highs?

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Trading Centrica – An Example

Let’s say you think that Centrica shares have upside potential as result of this broker upgrade. You decide to buy exposure to £10,000 worth of Centrica using a CFD, at the current price of 148p. To do this, you need £2,000.

For the purpose of this example, let’s assume the Centrica share price rises to 164p. Your profit would be £1,080, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. Centrica shares continue falling as a result of the downgrade, they fall 5% and hit your stop-loss. Your loss would be £500.

This is provided for information purposes only. It should not be taken as a recommendation.