Baker Hughes: What Implied Volatility Shows for Its 7-Day Price

Alex Chamberlin - Author

Mar. 9 2017, Updated 10:37 a.m. ET

Baker Hughes’s implied volatility

On March 8, 2017, Baker Hughes’s (BHI) implied volatility was ~23.6%. Since the U.S. Department of Justice’s second information request was announced on March 6, Baker Hughes’s implied volatility has risen from 22% to the current level. Baker Hughes accounts for 3.4% of the SPDR S&P Oil & Gas Equipment & Services ETF (XES).

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Implied volatility for Baker Hughes’s peers

On March 8, Helmerich & Payne’s (HP) implied volatility was ~30%, while Helix Energy Solutions’ (HLX) implied volatility was ~59%. On the same day, CARBO Ceramics’ (CRR) implied volatility was ~59%.

What does implied volatility suggest for Baker Hughes’s price?

Based on Baker Hughes’s implied volatility and assuming a normal distribution of stock prices and one standard deviation probability of 68.2%, Baker Hughes stock will likely close between $59.60 and $55.82 in the next seven days. Baker Hughes’s stock price was $57.71 on March 8, 2017.


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