The Future of PBR
Dear Profit Takeover reader,
Brazil is getting ready to choose a new president – and this election could have a dire effect on one of the largest oil and gas producers in the world:
Petrolio Brasileiro (NYSE:PBR).
Brazil has got two guys running: the current rightwing leader, Jair Bolsonaro, who has talked about privatizing the company.
And on the left, they’ve got Luiz Inácio Lula da Silva, who wants to assert more government control over the company and diversify its exports.
Both of these guys have got a lot of support… and a lot of critics. Right now, according to the polls, Lula is projected to win the presidential race.
Here’s what you need to know.
The last time the left was in power in Brazil, PBR was almost left ridden with debt after a massive multibillion-dollar corruption scam.
I’m not saying this is going to happen again. But the Brazilian presidential election will have a major impact on the future of PBR…
And here’s exactly how you should be trading this oil stock…
In the past six months, PBR has fallen over 3%:
And I don’t think that the upcoming election will do anything to help that.
It’s possible that PBR will lose its dividend, which would be catastrophic for long-term investors and the stock itself.
Plus, I think oil stocks in general are overvalued right now.
That’s why I’d recommend going short PBR.
This morning, the stock opened at $14.14. But I think it’s heading below $13.50 by October 21 – and you can play that move with a short-dated put option on PBR.
13 responses to “The Future of PBR”
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October 06 2022
Okay, took some 10/7 14.5 puts @ .33.
Always a great concise explanation Mark. Thank you
What’s your play for PBR?
What is the play?
What is the stoke price?
What is the acceptable price to pay for each Put?
Keep me informed when to buy PBR?
Thanks for the information
Very interesting information 👍
I don’t know how if you can teach me I would appreciate it .
I would love to trade with your help I know I could do it or if you have someone who can do it for me that would be appreciated thank you 🙏🏽
I love these simple trades with explanation.