Chocolate Covered Trade

Tuesday, 27 May 2008 | 3:58 PM ET

Hershey shares are off to the races with options through the roof. What's cooking?

A large number of options in Hersheytraded on Tuesday, explains Pete Najarian on CNBC’s “Closing Bell,” with volume coming in around 20,000 contracts.

The most popular are the July 40 calls, he reveals which suggest the stock could go higher.

Is there a catalyst?

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With energy costs skyrocketing there’s speculation that Hershey could be looking for a strategic alliance, he replies. However be careful. In April Hershey reported first-quarter earnings of $63.2 million, down from about $93.5 million at the end of last year's first quarter and their sales were flat.

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