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Casino-Resort Shares, Options Boil on Takeover Talk

Starwood Hotels and Resorts is seeing some unusual options activity Tuesday, as the chain once again finds itself the subject of takeover rumors.

Today's options action in HOT centers on the February 20 strike, where more than 5,000 calls have traded at twice the open interest, going for $0.50 and $0.55, according to OptionMonster's proprietary tracking systems.

The stock went as high as $16.75 as those rumors circulated this morning; but as of this writing, dropped as much as 3.7 percent on the day to $15.74.

Starwood has been the subject of rumors for years, so any buyout speculation must be viewed with suitable skepticism. Earlier this month, for example, HOT shares popped on talk of a possible investment by Sam Zell's Equity Group Investments.

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Rival Casino-Resort Chains:

MGM Mirage

Wynn Resorts

Las Vegas Sands

Ameristar Casinos

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Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC's "Fast Money" and co-founder of OptionMonster.com.

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