Buyers in Leidos Holdings, Inc. LDOS have to pay shut consideration to the inventory based mostly on strikes within the choices market recently. That’s as a result of the Feb 21, 2025 $105.00 Name had among the highest implied volatility of all fairness choices right this moment.
What’s Implied Volatility?
Implied volatility exhibits how a lot motion the market is anticipating sooner or later. Choices with excessive ranges of implied volatility counsel that buyers within the underlying shares predict an enormous transfer in a single path or the opposite. It might additionally imply there’s an occasion arising quickly which will trigger an enormous rally or an enormous dump. Nonetheless, implied volatility is just one piece of the puzzle when placing collectively an choices buying and selling technique.
What do the Analysts Suppose?
Clearly, choices merchants are pricing in an enormous transfer for Leidos shares, however what’s the elementary image for the corporate? Presently, Leidos is a Zacks Rank #2 (Purchase) within the Aerospace-Protection trade that ranks within the Prime 35% of our Zacks Trade Rank. During the last 60 days, one analyst has elevated his estimate for the present quarter, whereas one has revised his estimate downwards. The online impact has taken our Zacks Consensus Estimate for the present quarter to maneuver from $2.16 per share to $2.18 in the identical time interval.
Given the way in which analysts really feel about Leidos proper now, this big implied volatility might imply there’s a commerce creating. Usually occasions, choices merchants search for choices with excessive ranges of implied volatility to promote premium. It is a technique many seasoned merchants use as a result of it captures decay. At expiration, the hope for these merchants is that the underlying inventory doesn’t transfer as a lot as initially anticipated.
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Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the writer and don’t essentially replicate these of Nasdaq, Inc.
