RE: stop worrying about the short position7 Feb 2021 12:19
Warthog, IMO, I believe it's simply because of 3 things. Firstly the fact Lufkin is due to be sentenced next week, regardless of whether he's currently connected to PFC or not... Secondly the rumours around PFC itself being targeted for action by SFO, and lastly the results on top of the above 2 points!
Basically, they're betting on the sentiment surrounding the company more than the facts. Just as you would bet on a horse on its form by looking at the last race it ran, the condition of the soil it ran on, weather, owner and Jockey!
We know the results are not gona be super, because over the last year no-one other than those in the pharma sector, (mainly), have shown great progress and to compound this problem more..this Saudi business with OPEC and oil prices haven't been the best over the last year tbh. Lufkin will be sentenced, that's a fact naturally...BUT a nice RNS from SFO stating that no further action is to be taken against Petrofac will put a full stop to Rye Bay and the likes of... and of course an upward force on the share price!
Now the other scenario is of course is if the SFO decide to pursue PFC by way of a fine, for which the a separate charge against the company will have to be brought forward, how much the fine they're seeking and whether a judiciary committee deems that to be fair. IMO, I believe they won't pursue the company anymore as they have their man/men, and if they do, then any judiciary committee will take on board the horrible pandemic situation over the last year, or at least PFC's legal team will want push that agenda when any committee considers its verdict.
Naturally all of the above is in my personal opinion, but those are the facts i'm using and nothing else. PFC is still pulling excellent contracts in the industry which shows that confidence in the sector, and that's good enough for me!
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