Implied volatility

BP (BP) posted its first-quarter earnings, which beat analysts’ earnings expectation. The stock reacted positively to the news. In this part, we’ll discuss how BP stock could trend in the next ten days ending May 10. We’ll also discuss the changes in BP’s implied volatility on its earnings release day.

BP’s Stock Price Forecast Range after Its Q1 Earnings

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BP reported its first-quarter earnings on April 30. The implied volatility in BP (BP) fell by 3.4 percentage points to 16.9%. The implied volatility was lower than BP’s 30-day average implied volatility at 17.7%. On the same day, BP’s stock price rose 1.7%.

BP’s stock forecast

Considering BP’s implied volatility of 16.9% and assuming a normal distribution of prices and standard deviation of one with a probability of 68.2%, BP’s stock price could close between $45.0 and $42.5 per share in the ten days ending May 10.

Peers’ implied volatility

Like BP, the implied volatility in Petrobras (PBR) and PetroChina (PTR) fell by 0.6 percentage points and 0.3 percentage points, respectively, over the previous day to 36.6% and 20.7%, respectively, on April 30. The implied volatility in Chevron (CVX) fell by 1.7 percentage points to 18.1% on the same day.

If we consider the stock price changes, then Petrobras and PetroChina fell 0.9% and 0.6%, respectively, on April 30. However, Chevron stock rose 2.0% on the day.

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