Implied volatility trends
Current implied volatility in Whiting Petroleum (WLL) is ~53%. In comparison, peers Oasis Petroleum (OAS) and Continental Resources (CLR) have implied volatilities of ~51.2% and ~37%, respectively. The broader energy sector, represented by the Energy Select Sector SPDR ETF (XLE), has an implied volatility of ~19.4%.
Forecasting WLL’s stock price range
Based on Whiting Petroleum’s implied volatility of ~53% and assuming a normal distribution of stock prices with a standard deviation of one (or a probability of 68.0%), Whiting Petroleum stock will likely close between $27.2 and $31.45 in the next seven days. Next, in this series, we’ll discuss analysts’ opinions about Whiting Petroleum in the next 12 months.