Is the Options Market Predicting a Spike in GXO Logistics (GXO) Stock?

Investors in GXO Logistics, Inc. GXO need to pay close attention to the stock based on moves in the options market lately. That is because the Feb 21, 2025 $62.50 Call had some of the highest implied volatility of all equity options today.What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.What do the Analysts Think?Clearly, options traders are pricing in a big move for GXO Logistics shares, but what is the fundamental picture for the company? Currently, GXO Logistics is a Zacks Rank #4 (Sell) in the Transportation - Air Freight and Cargo industry that ranks in the Bottom 6% of our Zacks Industry Rank. Over the last 60 days, one analyst has increased the earnings estimates for the current quarter, while four have dropped their estimates. The net effect has taken our Zacks Consensus Estimate for the current quarter from earnings of 96 cents per share to 94 cents in that period.Given the way analysts feel about GXO Logistics right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.Looking to Trade Options?Check out the simple yet high-powered approach that Zacks Executive VP Kevin Matras has used to close recent double and triple-digit winners. In addition to impressive profit potential, these trades can actually reduce your risk.Click to see the trades now >>5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GXO Logistics, Inc. (GXO): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks