The GBp 232.5 support area, currently tested, might facilitate a technical rebound, and the company’s fundamentals support this scenario.

The British oil company displays a strong profitability with significant margins and a net income expected to increase from USD 244 million in 2013 to 337 million this year. The valuation levels of the security are also attractive with a low P/E ratio expected at 6.70x this year. Furthermore, analysts consensus regarding the target price is valued at +57%, which represents a real opportunity.

The share, currently oversold, evolves within a downtrend in the medium term. In the short term, this trend could be reversed as it approaches the GBp 232.5, level from which the bullish run could start wide-range movements. This support represents a buying opportunity in the context of a foreseeable technical rebound toward GBp 256.6 and by extension GBp 287.9.

The technical situation calls for Premier Oil buys at current prices with an upside potential to GBp 256.6 and GBp 287.9 by extension. However, this investment strategy will require a stop loss below GBp 232.5.