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Chevron’s Stock Price Forecast Range after Its 3Q17 Earnings

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Nov. 1 2017, Updated 7:33 a.m. ET

Implied volatility in Chevron

In the previous part, we examined the post-earnings analyst ratings for Chevron (CVX). In this final part of the series, we’ll look at changes in Chevron’s implied volatility. We’ll also estimate Chevron’s stock price range for the seven-day period ending November 3, 2017.

Chevron (CVX) reported its earnings on October 27, 2017. On the earnings release day, implied volatility in Chevron fell 1.5% to 14.1% compared to the previous day. This trend is in line with its 30-day average implied volatility of 14.1%. On October 27, Chevron’s stock price fell 4.2%.

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Expected price range for Chevron stock

Chevron’s implied volatility is 14.1%. Assuming a normal distribution of prices, a standard deviation of 1, and a probability of 68.2%, Chevron’s stock price could close between $111.30 and $115.80 per share in the seven-day period ending November 3.

Peers’ implied volatility

Like Chevron, implied volatility in Royal Dutch Shell (RDS.A) fell 0.2% over the previous day to 16.3% on October 27. Also, implied volatilities in Statoil (STO) and Petrobras (PBR) fell 1.2% and 0.5%, respectively, to 18.0% and 31.9%, respectively, on October 27.

In terms of stock price changes, Shell’s stock price rose 0.6% on October 27. STO and PBR stock rose 1.1% and 3.3%, respectively, on the same day.

The SPDR Dow Jones Industrial Average ETF (DIA) saw a 1.6% fall to 8.3% in its implied volatility on October 27. Also, the SPDR S&P 500 ETF (SPY) witnessed a 2.3% decrease in its implied volatility to 8.1% on the day. 

DIA rose 0.1% and SPY rose 0.8% on October 27.

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