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NRG Energy Leads in Implied Volatility among Utility Stocks

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Utility stocks with high implied volatility

On November 16, 2016, NRG Energy (NRG) had the highest implied volatility among the utility companies that make up the Utilities Select Sector SPDR ETF (XLU).

NRG Energy’s implied volatility was 54% on November 16. Its 15-day average implied volatility was 54.4%. Its current volatility is thus 0.7% lower than its 15-day average. NRG announced its quarterly results on November 4, 2016, reporting adjusted EPS (earnings per share of) $0.77, as compared to $0.71 one year ago.

Let’s take a look at the implied volatility of other utility stocks as of November 16, 2016:

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  • AES’s (AES) implied volatility is 30.6%—about 4.7% more than its 15-day average.
  • Xcel Energy (XEL) implied volatility is 29.9%—26.5% higher than its 15-day average.
  • SCANA Corporation (SCG) implied volatility is 27.7%—33.2% higher than its 15-day average.
  • Exelon’s (EXC) implied volatility is 25.3%—6.8% higher than its 15-day average.

Xcel Energy and SCANA both witnessed spikes in their implied volatilities.

Utilities stocks with low implied volatility

On November 16, Dominion Resources’ (D) had the lowest implied volatility of all the utility companies that make up XLU. Dominion Resources’ implied volatility is 19.2%. Its 15-day average implied volatility is 18.6%, and its current implied volatility is 3.3% higher than its 15-day average.

Let’s look at the other utility stocks with low implied volatilities as of November 16, 2016.

  • Pinnacle West Capital’s (PNW) implied volatility is 19.5%—4.4% less than its 15-day average.
  • American Water Works’ (AWK) implied volatility is 20%—1.3% more than its 15-day average.
  • Southern Company’s (SO) implied volatility is 20.2%—5.7% higher than its 15-day average.
  • DTE Energy’s (DTE) implied volatility is 20.4%—7.2% higher than its 15-day average.

Remember, large movements or expectations of large movements in stocks’ prices can cause stocks’ implied volatilities to rise. Continue to the next part for a look at the returns of the above stocks.

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