NOW’s implied volatility
Between May 2, when NOW (DNOW) released its first-quarter results, and May 23, its implied volatility fell from 43.7% to 39.1% and its stock price rose ~5.4%. DNOW comprises 0.18% of the iShares S&P Mid-Cap 400 Value ETF (IJJ), which provides exposure to US mid-cap stocks that are considered undervalued by the market. The energy sector accounts for 11.2% of IJJ, which has risen ~6% since May 2.
NOW’s seven-day stock price forecast
Considering a normal distribution, a standard deviation of one, and a probability of 68.2%. NOW stock will likely close between $15.38 and $13.80 in the next seven days based on its implied volatility. Its stock price was $14.59 on May 23.
Seven-day price forecasts for DNOW’s peers
- Halliburton’s (HAL) implied volatility on May 23 was 24.1%, which implies its stock price could be $54.69–$51.15.
- CARBO Ceramics’ (CRR) implied volatility was 58.7% on May 23, which implies its stock price could be $11.54–$9.80.
- TechnipFMC’s (FTI) implied volatility was 29.9% on May 23, which implies its stock price could be $33.92–$31.22. For more about FTI, read Market Realist’s TechnipFMC’s 1Q18 Earnings Missed Analysts’ Estimates.
Crude oil’s implied volatility
Between May 2 and 23, crude oil’s implied volatility fell to 23.2%, like DNOW’s implied volatility. Next, we’ll discuss DNOW’s correlation with crude oil.