Is POWR ready to come back?
As we roll into the Memorial Day weekend when most traders are taking a break, we should have a little less activity than usual. Stocks are just about at all-time highs for the SPX and the smattering of decent economic news is keeping a floor under stocks for now. Not all stocks are like that.
Taking a look at PowerSecure Intl. (POWR) in the OptionVision Landscape, the stock was the most volatile (dark green) over a 10 day period relative to the 20 day historical volatility. Over the last week the stock was up around 7%. That move in and of itself did not generate the volatility. It was the over 50% drop on earnings that most premium sellers fear that drove up the HV. The biggest jump in price on the tallest spike is a Russian payment processer, QIWI.
The business for POWR was pretty good until the last quarter. They have a client base of utilities looking for systems to save energy for customers. The Green thing has been a pretty good ride and the future should be better after some management missteps recently. The reported book value for POWR is around $7. For a speculative portfolio selling some OTM puts that get in below book value at the higher IV’s might be a good way to own some of this stock at lower prices. A short term jump is probably not in the cards.
OptionVision™ – data from ORATS
Read more from Andrew at Option Pit
Posts
No comments:
Post a Comment