Analyzing BP’s Forecast Price Range ahead of Its Earnings



Implied volatility in BP

In this article, we’ll look at BP (BP) stock’s price forecast range for the 18 days leading up to its earnings release. BP is expected to post its first-quarter earnings results on April 30, 2019. This price range forecast will be based on the current level of implied volatility in BP.

The implied volatility in BP has risen 1.7 percentage points over March 12, 2019, to the current level of 17.3%. During the same period, BP stock has risen 5.2%.

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BP’s expected price range until April 30

Considering BP’s implied volatility of 17.3% and assuming a normal distribution of prices (using the bell curve model) and a standard deviation of one (with a probability of 68.2%), BP stock could close between $46.4 per share and $43.0 per share in the 18 days leading up to April 30.

Peers’ implied volatilities

Like BP, the implied volatilities in Total (TOT) and Petrobras (PBR) have risen 0.5 percentage points and 8.7 percentage points, respectively, since March 12. Currently, the implied volatilities in Total and Petrobras stand at 17.4% and 41.8%, respectively. The implied volatility in Suncor Energy (SU) has risen 0.6 percentage points over March 12 to the current level of 21.8%.

If we review their stock prices, we’ll find that Total, Petrobras, and Suncor have fallen 1.0%, 5.6%, and 0.1%, respectively, in the same period.


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