The video stabilisation icon is greyed out

I am unable to stabilize videos while using iMovie 10.0.1. The stabilization icon is greyed out and nothing happens when I try to click through. Is anyone else facing the same issue and is there a resolution?

Is it that you are trying to stabilise a clip in the events?  Stabilisation can only be activated on a clip when it is in a project timeline.   It is done in a background task and may take several minutres before it is finished.  The stabilisation should then be visible when scrubbing through the clip in the timeline.  (Scrubbing through the same clip in the events pane will still not be stabilised). 

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