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Analyzing Schlumberger’s 7-Day Stock Price Forecast

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Schlumberger’s implied volatility

Schlumberger’s 3Q17 financial results were released on October 20. On October 27, 2017, Schlumberger’s (SLB) implied volatility was ~18%. Since its 3Q17 financial results were released, Schlumberger’s implied volatility has fallen from 20% to this level. During the same period, Schlumberger’s stock price rose 1%. Schlumberger accounts for 3.2% of the SPDR S&P Oil & Gas Equipment & Services ETF (XES). XES has fallen 4% since July 21, 2017.

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Schlumberger’s seven-day stock price forecast

Schlumberger stock will likely close between $65.12 and $61.98 in the next seven days—based on its implied volatility. Schlumberger’s seven-day stock price forecast considers a normal distribution of stock prices and one standard deviation probability of 68.2%. Schlumberger’s stock price was $63.55 on October 27, 2017.

Implied volatility for Schlumberger’s peers         

On October 27, National Oilwell Varco’s (NOV) implied volatility was ~25%, which implies that its stock price could vary between $34.40 and $32.06 in the next seven days. Helmerich & Payne’s (HP) implied volatility was ~34% on October 27. Its implies that Helmerich & Payne’s stock price could range between $55.09 and $50.13 in the next seven days. Tidewater’s (TDW) implied volatility was ~56% on October 27, which implies that its stock price could vary between $29.63 and $25.35 in the next seven days. Read Oilfield Services Stocks: Free Cash Flow Winners and Losers to learn more.

Crude oil’s implied volatility

On October 27, crude oil’s implied volatility was 23.5%. Since October 20, crude oil’s volatility has fallen marginally. Schlumberger’s implied volatility also fell. Since October 20, 2017, the S&P 500 Index (SPX-INDEX) has remained unchanged. The energy sector makes up 6.0% of the S&P 500 Index.

In the next part, we’ll discuss Schlumberger’s correlation coefficient with crude oil.

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