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Home / Trade Alert / Buy – Pearson (PSON)

This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.

Buy – Pearson (PSON) - 7 December 2017

Trade Parameters

  • Opening Price: 735p
  • Stop Loss: 715p (20p/2.7% below)
  • Profit Limit: 772p (37p/5.0% above)
  • Reward vs Risk: 1.9x
  • CFD Margin: 5%

Observations – For

  • Bullish breakout; Highest since early May 
  • Momentum rising
  • Point & Figure breakout

Observations – Against

  • Stochastics overbought
  • No volume jump on breakout
  • Moving average support well below

Analyst Comments

Strong share price reversal from September, with major breakout today. Company still simplifying itself with disposals. Current share buyback is supportive for shares. Potential benefit from lower US tax rate.

Consensus is skewed negative, which may see some brokers upgrade given the shares’ 30% rebound. Especially having rallied above the average broker target in mid-October, and with two thirds of brokers still with targets below the current share price. Revisions required? Even the latest revised broker targets have already been hit.

Next Event: Trading update, Jan; FY results, Feb

Latest Broker 12-Month Consensus:  23% Buy, 36% Hold, 41Sell (full breakdown on request)

Source: DowJones Newswires, Reuters News, Bloomberg  or Company Press releases

Broker Ratings & 12-Month Target Prices (Bloomberg)

7-month (daily); Price, Momentum, Stochastics

Share 1wk 1m 3m 6m 1yr 2yr 3yr 4yr 5yr
Perf % 3.9 5.5 22.8 3.8 -7.3 -5.9 -39.7 -43.0 -38.2
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This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.

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