NEW YORK (TheStreet) -- Shares of Petrobras (PBR) - Get Petroleo Brasileiro SA Sponsored ADR Report were gaining in late-morning trading on Friday as Credit Suisse raised its rating on the stock to "neutral" from "outperform."
The firm also upped its price target to $8.60 from $2 on shares of the Brazilian oil company.
"Management can add considerable value through cost and capex efficiency, divestments, fuel pricing, and strategic changes. Our target price assumes all these measures succeed but they're not enough to make value converge to prices," the firm wrote in a note.
While "excitement" may continue on the back of positive news flow, Credit Suisse does not see a compelling risk and return ratio that could offer a considerable margin of safety.
"Conditions have clearly improved in recent months, especially for liquidity, but it doesn't justify whatever price. We believe it still depends on oil prices rebounding to above $80 for upsides to be material," the firm added.
Additionally, oil prices are higher today. Crude oil (WTI) was up 1.1% to $47.85 per barrel and Brent crude was increasing 0.79% to $50.06 per barrel this morning.
Separately, TheStreet Ratings Team has a "Sell" rating with a score of D+ on the stock.
The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, disappointing return on equity, weak operating cash flow and feeble growth in its earnings per share.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: PBR