PG&E’s Recent Implied Volatility Trends



Implied volatility

PG&E (PCG) was one of the most stable stocks among the S&P 500 Utilities last year, PG&E has been witnessing immense volatility in the last few months. On February 9, 2018, the implied volatility was ~40%—higher than its 15-day average.

PG&E’s implied volatility in September 2017, before the wildfires, was close to 15%—near broader utilities’ average.

Higher implied volatility levels indicate investors’ increased nervousness. Higher implied volatility is often linked to a fall in stock prices and vice versa.

The Utilities Select Sector SPDR ETF (XLU) tracks the S&P 500 Utilities Index. XLU’s implied volatility is 21%, while broader markets’ implied volatility is beyond 22%.

To learn how the most volatile utility stocks (VPU) (IDU) played out recently, read Analyzing the Top 5 Most Volatile S&P 500 Utilities.

Next, we’ll discuss analysts’ target price and views on PG&E stock.

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