Are Options Traders Betting on a Big Move in Blink Charging (BLNK) Stock?
Investors in Blink Charging Co. BLNK need to pay special attention to the stock due to recent changes in the options market. This is because the November 20, 2020 put of $ 15.00 had the highest implied volatility of any stock option today.
What is Implied Volatility?
The implied volatility shows how much movement the market expects in the future. Options with high implied volatility suggest that investors expect a large move in one direction or another in the underlying stocks. It could also mean that there is an event coming up soon that could lead to a major rally or sell-off. However, implied volatility is only part of the puzzle when putting together an options trading strategy.
What do the analysts think?
It's clear options traders are pricing in a big leap for Blink Charging stocks, but what's the basic picture for the company? Currently, Blink Charging is a Zacks Rank 4 (Sales) in the Electronics - Miscellaneous Services industry, which is below the bottom 1% of our Zacks industry rank. In the past 60 days, no analysts have raised their earnings estimates for the current quarter while the estimate has been revised downwards. The net effect has raised our Zacks consensus estimate for the current quarter from a loss of 8 cents per share to a loss of 9 cents over the period.
Given analysts' current view of Blink Charging, this huge amount of implied volatility could mean that a trade is developing. Often times, options traders look for options with high implied volatility to sell premiums. This is a strategy many seasoned traders use because it captures expiration. When it expires, the hope for these traders is that the underlying stock will not move as much as originally expected.
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