Petrofac Share Discussion Threads

[csj0hn] 06/2/2021 21:16

Ryad, theoretical sami is correct. Don't forget in an open market the sellers and buyers are all playing at the same time. There might well be other factors affecting the share price going on at the same time.

Shorting a stock do go horribly wrong sometimes and hence the huge losses

[csj0hn] 06/2/2021 21:06

Does anyone know if there are any reports/institutions/analysis out there that would give an indication of the underlying factors that has driven a downward movement in a company's share price Shorting a stock is only one such factor.

[ryad123] 06/2/2021 20:50

Sami, if it was that simple then how can they make a profit unless the shares fall over and above the initial fall caused by the selling. Let's say a hedge sells 1 million shares at 100p causing to them to fall to 80p, suppose nothing happened to make the price fall further, then eventually they will have to buy them back, let's say the action of buying causes the price to rise by 20 percent, factor in the transaction costs and borrowing fees and you will see that there is not much profit there except the risk of a squeeze. In this case they will make a profit only if there is something that causes the share to fall below 80p, so the shorts would better be right about fundamentals, otherwise how do you explain the 25 billion dollars lost shorting Tesla.

[sami69] 06/2/2021 20:14

RyadI don't think you understand how shorting works.Usually, hedge funds borrow the shares from other institutions. They pay a fee to them for borrowing the shares. Once they borrow they then sell them on the market..hence driving the price down.It's not just a bet on the share price going down...their actions of selling borrowed shares in volume drives can drive the price down.

[ryad123] 06/2/2021 19:45

No we don't have the volume and even we did it won't change a thing, suppose you have the cash to open a short on 5 percent of the shares, why would this action alone affect the price? I can pefectly get why the price goes up when there is a big buy order but when you go short you are just placing a bet on the price going down without owning the shares, perfectly sound if used as a hedging instrument but a naked short on a bombed out stock is a pure gamble, at this price anyway there is little upside for the shorts. Metro bank had nearly 10 perecent of its stock on shorts even when it was below 60p, it doubled then went back 60p then doubled again.

[csj0hn] 06/2/2021 19:31

ryad123 ....... If the mere action of shorting a stock makes go south then let's short it and make buckets of easy cash

Do you really think we have the volume to affect the SP?

[ryad123] 06/2/2021 17:14

Yes it's already in the price, from 400p to just over 100p in a year, in the meantime many other companies like WG, Weir and hunting recovered some lost ground. The other thing i don't get on this board is the idea that shorters hurt the price, how? If the mere action of shorting a stock makes go south then let's short it and make buckets of easy cash, Warren Buffet said it many times, why do people believe this nonsense is beyond me.

[dealy] 06/2/2021 14:22

no, the company would take a charge this year. no effect on profits in the future years. 1 billion pounds of fines has already been priced in

[plunger2] 06/2/2021 14:13

What fine?
Good luck with that theory!

[pepepepe73] 06/2/2021 14:00

@dealy, that would destroy profits for the next 5 years.

[dealy] 06/2/2021 13:44

100m per year over 5 years. but I don't see it coming to that

[pepepepe73] 06/2/2021 13:29

@Dealy, consider the case of 500m fine.

How does PFC address that fine?, debt or rights issue?

[dealy] 06/2/2021 12:27

The combination of the following factors could see Petrofac double in the next 2 weeks:- evaporation of SFO case- very strong crude price- return to normal post covid- need to put new energy facilities contracts in placeThese are all individually huge tailwinds for Petrofac But in combination and in the context of a large short position the stock could really surge.

[dealy] 06/2/2021 12:17

Plus it puts a dark cloud over London as a place to list your global company. Brexit Britain doesn't need that

[dealy] 06/2/2021 12:03

I think the matter will be closed on Thursday with the sentencing of the former sales executive. The warning signals have been heeded and Petrofac and other companies have tightened up controls. There is no point in pursuing things further.If the case evaporates the shares will jump a pound instantly

[plunger2] 06/2/2021 11:40

The ramifications of this judgement could be large - very large.
Has the SFO gained evidence improperly?
Has the SFO compelled evidence illegally?
Is the SFO determined to police activities in other jurisdictions in which it has no business?
Is the SFO wasting UK taxpayers money on events that are not relevant?

Lisa Osofsky has already run into plenty of turbulence. She was not even in the Serious Farce Office when the PFC case was opened.

I know what I would do now.

GLA

[leoneobull] 06/2/2021 11:30

How about zero fine, and standing on the naughty boys step instead?otmansalamatPrice: 116.50No OpinionRE: U.K. Supreme Court deals blow to SFOToday 11:15Supreme Court clips Serious Fraud Office's wingsBy Jemma Slingo5 February 2021The Supreme Court has curbed the Serious Fraud Office's extra-territorial powers, ruling that it cannot demand documents held outside the UK by a foreign company under the Criminal Justice Act 1987.In KRB v SFO, the Supreme Court found that the SFO overreached itself when it issued a notice under section 2(3) of the Criminal Justice 1987. The notice required US engineering conglomerate KBR Inc to produce material held overseas.A UK subsidiary of KRB provided the SFO with documents in 2017. However, when the investigator attempted to obtain documents held outside of the UK, KRB applied for judicial review to quash the notice.In a judgment handed down this morning, the Supreme Court unanimously upheld KRB's appeal. It found that section 2(3) of the 1987 act is generally not intended to have extra-territorial effect and that the presumption clearly applies in this case because KBR, Inc is not a UK company, and has never had a registered office or carried on business in the UK.The court also rejected the argument that parliament intended section 2(3) to give the SFO the power to compel a foreign company to produce documents it holds outside the UK.In judgment Lord Lloyd-Jones stated that successive acts of parliament have developed structures in domestic law which permit the UK to participate in international systems of mutual legal assistance in relation to criminal proceedings and investigations.'It is to my mind inherently improbable that parliament should have refined this machinery as it did, while intending to leave in place a parallel system for obtaining evidence from abroad which could operate on the unilateral demand of the SFO, without any recourse to the courts or authorities of the state where the evidence was located and without the protection of any of the safeguards put in place under the scheme of mutual legal assistance,' he said.The court ruled there was no basis fo?r the divisional court's finding that the SFO could use the power in section 2(3) to require foreign companies to produce documents held outside the UK if there was a sufficient connection between the company and the UK.Commentators said the judgment could significantly alter how the SFO conducts extra-territorial investigations"

[plunger2] 06/2/2021 10:20

Though I really liked your speeding analogy dealy.
A disastrous result for SFO - fully deserved.
Hopefully they'll pull stumps and get the FCA to tackle the much more damaging Shorting behaviour by licensed pirates!!!

[dealy] 06/2/2021 09:30

The range ot outcomes form the SFO investigation is large with no fine also a possibility. The stock price reflects a fine or damages worth 1 billion GBP. I personally think this is a matter for the UAE authorities and the SFO only has a benchmarking role

[pepepepe73] 06/2/2021 09:13

Next 3 days should be positive with the stock price ramping up nicely.

Shorts already made their game here and now it's time for them to buy the shares back again.

[leoneobull] 06/2/2021 07:10

HUGE growth in oil demand in China. High Brent means more PFC contracts and a pick up in services activity https://www.bloomberg.com/news/articles/2021-02-05/a-huge-number-of-oil-supertankers-are-pointing-at-china-s-ports

[mickinvest] 05/2/2021 21:08

February 05, 2021 

Malaysia-based investment holding company Icon Offshore Berhad, announced that its new subsidiary company, POSB (Perisai Offshore Services Berhad) has received an award for the provision of the jackup drilling rig Perisai Pacific 101 (PP101), from Petrofac.

The expected commencement of the drilling contract is in April 2021 for a primary period of 180 days with firm eight wells, and with an optional three wells extension.

[dealy] 05/2/2021 20:48

The SFO sticking its nose into events that happened in another country is a bit like the British Police giving you a speeding ticket for being caught speeding whilst on holidays in Benidorm. Charges and fines are dealt with where they are committed. This supreme Court ruling just confirms this obvious point.

[asa8] 05/2/2021 20:18

The sfo have got what they wanted by collapsing the share price all contrived with the shorting fraternity surely that’s
Enough