Is it irrelevant, or will the Upgrade make the Ferguson share price more attractive?

• Day by Day upgrades to Buy with a target price of 6400p.
• Consensus: 13 Buys, 8 Holds, 4 Sell; Avg target: 5606p (Source: Bloomberg).
• Current share price 5167p (at time of writing).
• Will the shares turn back, or will they rally back to recent 5555p highs?
• Shares -7.7% from 2019 highs; +12.5% from 2019 lows; +3% year-to date.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Ferguson – An Example

Let’s say you think that Ferguson shares have upside potential as result of this broker upgrade. You decide to buy exposure to £10,000 worth of Ferguson using a CFD, at the current price of 5167p. To do this, you need £2,000.

For the purpose of this example, let’s assume the Ferguson share price rises to recent highs at 5555p (+7.5%). Your profit would be £750 from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 2% from the current price. Ferguson shares fall 2% and hit your stop-loss. Your loss would be £200.

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