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

• The chart shows the Petrofac share price since August.
• Morgan Stanley has upgraded to Overweight, with a price target of 800p.
• Consensus summary: 9 Buys, 6 Holds, 1 Sell; Average target: 674p (Source: Bloomberg).
• Current share price 542p (at time of writing).
• Shares currently trade -20.7% from 2018 highs; +34.1% from 2018 lows; +13.8% year-to date
• 7 Jan: Jefferies says Petrofac performance in 2018 hard to fault
• 18 Dec: Petrofac says performing in line with expectations, new orders stand at $5bn
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Click to enlarge

Trading Petrofac – An Example

Let’s say you think that Petrofac shares have upside potential as result of this broker upgrade. You decide to buy exposure to £10,000 worth of Petrofac using a CFD, at the current price of 542p. To do this, you need £2,000.

For the purpose of this example, let’s assume the Petrofac share price rises to 670p Aug/Oct highs (+23.6%). Your profit would be £2360 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. Petrofac shares 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.