Thursday, January 17, 2013

Barnes & Noble (BKS) - New Annual Low in Vol as Stock Drops

BKS is trading $13.28, up 0.6% with IV30™ down 2.4%. The LIVEVOL® Pro Summary is below.


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Barnes & Noble, Inc. (Barnes & Noble) is a bookseller. The Company is a content, commerce and technology company that provides customers access to books, magazines, newspapers and other content across its multi-channel distribution platform.

I found this stock using a real-time custom scan. This one hunts for depressed vols. BKS has in fact breached a new annual low today.

Custom Scan Details
Stock Price GTE $5
IV30™ GTE 20
IV30™ Percentile LTE 10
Average Option Volume GTE 1,200

I last wrote about BKS on 10-10-2012, noting the vol pop on that day. I have included the Symbol Summary from that day, below -- note the vol difference between today and the prior post.

You can read the post here:
Barnes & Noble (BKS) - Vol Pops But Remains Depressed as Nook News is Good; Solvency and New Technology but Low Risk?

Let's turn to the one-year BKS stock chart (below).

On the stock side we can see that other than the crazy spike on 4-30-2012, the stock has found a rather quiet period. More myopically, we can see the stock has dropped from $16.30 on 12-11-2012 to now in the low $13 range.

But, ultimately, this is a vol note, so I have included the one-year IV30™ chart below.

This is a fascinating chart in that the implied has continued to fall (in trend) as the stock has fallen -- rather unusual, especially given the specifics of the firm -- a "book store" that is held up because of a tablet. The 52 wk range in IV30™ before today was [48.03%, 114.31%], so the level today is in fact a new annual low and yeah, the vol can go higher.

Finally, let's look to the Options Tab (below).

Across the top we can see the monthly vols are priced to 46.78% and 50.44% for Feb and Apr, respectively. That slight elevation to Apr reflects an earnings announcement due out after Feb expiry (but inside Apr). Ultimately I question BKS vol -- an annual low right now feels weird -- again, this was a bookstore about to go bankrupt until they invented a nifty tablet. 46% vol just feels... weird...

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