uploads/2017/05/IV-11.jpg

What’s Basic Energy Services’ Stock Price Forecast?

By

Updated

Basic Energy Services’ implied volatility

Article continues below advertisement

What does implied volatility mean?

Implied volatility (or IV) reflects investors’ views of a stock’s potential movement. However, IV doesn’t forecast direction. Implied volatility is derived from an option pricing model. Investors should note that the correctness of implied-volatility-suggested prices can be uncertain. CARBO Ceramics’ (CRR) implied volatility on May 8 was ~67%, while Helix Energy Solution’s (HLX) implied volatility was 50% on the day. Helmerich & Payne’s (HP) implied volatility was 26% on May 8. HP makes up 1.3% of the iShares Select Dividend ETF (DVY). The energy sector makes up 6.3% of the SPX-INDEX. The SPX-INDEX rose 6% year-to-date versus a 23% fall in BAS’s stock price.

7-day stock price forecast for BAS

Based on Basic Energy Services’ implied volatility and assuming normal distribution of stock prices and one standard deviation probability of 68.2%, BAS’s stock will likely close between $29.43 and $25.15 in the next seven days. BAS’s stock price was $27.29 on May 8, 2017.

Next, we’ll discuss whether investors have shown interest in BAS’s stock as indicated by its short interest.

Advertisement

More From Market Realist