Schaeffer's 43rd Anniversary Stock Picks in 2024

3 Oil Stocks to Watch as Crude Prices Pop

Halliburton calls are all the rage today

Deputy Editor
Dec 23, 2022 at 10:49 AM
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The price of crude is jumping today, amid an impending expectation of a drop in Russian oil supplies. In turn, worries of a dent to U.S. transport fuel demand growth is being offset, even as a potential Arctic storm threatens travel during the holiday season. A few oil stocks worth highlighting today include Schlumberger NV (NYSE:SLB), Halliburton Company (NYSE:HAL), and Baker Hughes Co (NASDAQ:BKR), as all three sport notable early morning gains.

Schlumberger Sports Affordable Premium

At last check, Schlumberger stock is 0.6% higher to trade at $51.69, adding to its 73.8% year-over-year lead. The equity is pacing for its third weekly win in four, and hovering near its Nov. 14, roughly four-year high of $56.04.

Despite SLB's impressive technical foundation, options traders still favor puts. Data at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows the equity's 50-day put/call volume ratio of 0.63 ranks higher than 98% of annual readings. An unwinding of this pessimism is sure to add tailwinds.

Now could be the time to make that bet, as Schlumberger's options can be had for a bargain. This is according to its Schaeffer's Volatility Index (SVI) of 44%, which sits in the 28th percentile of its 12-month range, indicating options players are pricing in relatively low volatility expectations right now. What's more, the security tends to outperform said volatility expectations, according to its Schaeffer's Volatility Scorecard (SVS) rank of 75 (out of a possible 100).

Halliburton Bullish Bets Pop

Meanwhile, Halliburton stock is currently 1.7% higher to trade at $38.18. The stock's end-of-year gains have been capped by the $40 level, though HAL remains 65% higher in the last 12 months.

HAL's normally quiet options pits are seeing an uptick in bullish activity. Already, 2,222 calls have crossed the tape, which is double the intraday average volume. The January 20, 2023 38-strike call is the most popular position by far, with 1,765 contract traded so far.

Get Ahead of the Curve With Baker Hughes Stock

Finally, Baker Hughes stock sports a 0.7% lead at last check to trade at $28.55. The security is notably underperforming its sector peers, as it sits just 17.1% higher year-on-year. This could be due to the $31 level's pressure in recent weeks.

Bearish bets are all the rage in BKR's options pits. At the ISE/CBOE/PHLX, the security sports a 10-day put/call volume ratio of 0.81 that stands in the 87th percentile of its 12-month range. Meanwhile, its' Schaeffer's put/call open interest ratio (SOIR) of 0.85 ranks higher than 78% of annual readings.

Baker Hughes stock's SVI of 39% sits in the 11th percentile of its 12-month range, while its SVS tally stands at 93. This makes now a good time to bet on the stock's rally.

 

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