In the previous part, we discussed analysts’ ratings for Phillips 66 (PSX). In this part, we’ll review the changes in Phillips 66’s implied volatility. We’ll also estimate Phillips 66’s stock price range for the seven-day period ending on May 4.
Phillips 66 reported its earnings on April 27. After Phillips 66’s 1Q18 earnings, the implied volatility fell 4.7% to the current level of 19.2%. The implied volatility was lower than the 30-day average implied volatility at 22.9%. On April 27, Phillips 66 stock price fell 1.0%.
Expected price range
Considering Phillips 66’s implied volatility of 19.2% and assuming a normal distribution of prices (bell curve model) and a standard deviation of one (with a probability of 68.2%), Phillips 66’s stock price could close between $114.3 and $108.4 per share in the seven-day period after its 1Q18 earnings ending on May 4.
Implied volatilities in peers
In contrast to the trend in Phillips 66, the implied volatility in Delek US Holdings (DK) rose 0.7% on April 27 to 39.9%. The implied volatilities in HollyFrontier (HFC) and PBF Energy (PBF) increased 0.9% and 1.2%, respectively, to 33.1% and 38.5%, respectively. Delek US Holdings’ stock price fell 3.7% on April 27. HollyFrontier and PBF Energy’s stock prices fell 2.7% and 3.3%, respectively, during the same period.
However, the SPDR Dow Jones Industrial Average ETF’s (DIA) implied volatility fell by 0.7 percentage points to 13.7% on April 27. The SPDR S&P 500 ETF’s (SPY) implied volatility fell by 1.3 percentage points to 11.8% on the same day. On April 27, while SPY rose 0.1%, DIA fell 0.1%.