Hershey Co. (HSY) Is A Tease
by Houghton and Atkeson 09/11/08
On Aug. 6, we issued a trading alert highlighting unusual call activity in Hershey Co. (HSY) that appeared to signal a possible takeover.
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On Aug. 15, HSY guided earnings for the year to the low-end of the range, and the stock dropped to about $36 per share.
HSY is back!
Now the stock is trading above $40 again, six times the usual volume of options have traded on HSY today. Options investors are buying the HSY Oct 45 Calls (HSYJI) and HSY 50 Calls (HSYJJ), as well as the HSY Sept 40 Calls (HSYIH) and 45 Calls (HSYII).
Is this just another tease, or could HSY have unexpected good news coming before September options expiration on the 19?
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In the short-term, the government's bond auction is likely to be a key driver of stocks.
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The market seems to be saying that a 30% move up from the lows is ahead of the real economy and the market needs to allow the economy to catch up.
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