Exciting New Options for Hershey Company Investors
New contracts for Hershey Company (Symbol: HSY) became available today, set to expire in June 2026. With 562 days remaining, these contracts offer a unique chance for traders looking to engage in options trading, often allowing sellers of put or call options to earn higher premiums than those tied to shorter expirations.
At Stock Options Channel, we examined the HSY options chain and identified one put and one call contract that stand out.
Put Option Opportunity: $170 Strike Price
The put contract with a $170.00 strike price currently has a bid of $12.00. By selling this put contract, an investor agrees to buy Hershey shares at $170.00, while earning the premium. This reduces the effective purchase cost to $158.00 (excluding broker fees). For those interested in buying HSY stock, this could be a more attractive option than purchasing at the current market price of $178.68 per share.
This $170.00 strike price offers about a 5% discount from the stock’s current trading price, classifying it as out-of-the-money. Furthermore, our analysis indicates a 65% chance that the contract could expire without value. If this occurs, it could yield a 7.06% return on the cash commitment, which annualizes to 4.58%—a figure we term as the YieldBoost.
Visualizing the Current Market
Below is a chart showing the trailing twelve-month trading history for Hershey Company, highlighting the $170.00 strike price with a green marker:
Exploring Call Options: $190 Strike Price
On the calls side, we found a $190.00 strike price contract with a current bid of $14.60. An investor buying HSY shares at the current price of $178.68 and subsequently selling this call contract as a covered call would agree to sell shares at $190.00. By collecting the premium, this strategy could yield a total return of 14.51% if the stock is called away at expiration in June 2026 (not including dividends and before broker fees).
It’s important to note that selling this call could limit potential gains if HSY shares increase significantly. Therefore, studying both HSY’s recent trading history and fundamental business factors is essential. Below is a chart illustrating HSY’s recent performance, with the $190.00 strike price marked in red:
Evaluating the Call Option
The $190.00 strike price represents about a 6% premium to the current trading price, making it out-of-the-money by that percentage. There’s a chance the covered call contract may expire worthless, which would allow the investor to retain both the shares and the collected premium. Current data shows a 50% likelihood of this occurrence. We will monitor these odds on our website, updating them as conditions change. Should the covered call expire without value, the premium would contribute an 8.17% additional return to the investor, or 5.31% annualized—another instance of YieldBoost.
Interestingly, both the implied volatility for the put and call contracts is approximately 24%. Meanwhile, we’ve calculated that the actual trailing twelve-month volatility, during which we analyzed the last 251 trading days, stands at 21%. For more insights into put and call options, visit StockOptionsChannel.com.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
