The automated Quantcha Trade Ideas Service has detected a promising
ROP was recently trading at $208.18 and has an implied volatility of 17.65% for this period. Based on an analysis of the options available for ROP expiring on 17-Nov-2017, there is a 45.80% likelihood that the underlying will close within the analyzed range of $198.11-$242.14 at expiration. In this scenario, the average linear return for the trade would be 27.54%.
Price target: Zacks Research has updated their six-month price target for ROP to $220.13. This price target is a consensus price created from the price targets published by 8 participating analysts whose targets ranged from $192.00 to $250.00.
Mean recommendation: Zacks normalizes analyst recommendations to a 1-5 scale where 1 indicates a strong buy. Their mean recommendation for ROP has been updated to 1.58, which indicates a buy consensus from analysts. Sentiment has moved from 1.75 to 1.42 to 1.42 over the past three months.
Trade approach: The difference between the current price for ROP and the mean price target is $11.32, which represents a 5.74% move (11.98% annualized). Since the 180-day implied volatility for ROP is 19.34%, a neutral range-bound strategy could prove effective if the price target ultimately turns out to be accurate.
Upside potential: Using this neutral range-bound strategy, the trade would be profitable if ROPER TECHNOLOGIES INC closed in the range $195.65-$254.35 on 17-Nov-2017. Based on our analysis, there is a 55.73% likelihood of this return. The maximum return for this trade would be 27.80% if ROPER TECHNOLOGIES INC closed in the range $200.00-$250.00.
Downside risk: As with any options trade, there is a substantial downside risk where you may lose most or all of your investment.
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This is an automated post generated based on a market analysis of delayed data at 3/28/2017 3:18:49 PM ET. The analysis does not include brokerage fees or commissions and is not investment advice.