Micro Focus surges again as Goldman upgrades to 'buy'

Shares of Micro Focus surged on Monday after Goldman Sachs upgraded the software company to ‘buy’ from ‘neutral’ and hiked the price target to 650p from 335p.

The bank said Micro Focus’s better-than-expected full-year trading update in November indicated there were early signs of a moderation in the rate of revenue declines. GS said four key assets - Vertica, IDOL, ArcSight and Fortify - are being overshadowed by the more challenged part of the business but have potential to unlock "significant" value.

It also said the shares would benefit from a rotation to value stocks.

Micro Focus shares rocketed at the end of last week after Amazon named it as one of the businesses approved to help companies move computer mainframes onto Amazon Web Services (AWS).

At 1100 GMT, the shares were up 15.2% at 496.20p.