Hershey shares downgraded due to cocoa inflation

Citigroup has adjusted the rating for HSY to “Sell”

Even though Halloween is fast approaching, Citigroup is staying away from Hershey Co (NYSE: HSY)The analyst in question downgraded the stock to “sell” from “neutral” and lowered his price target to $182 from $195, noting that cocoa inflation and volume issues could negatively impact earnings.

HSY was last down 0.8% at $194.80, but the 40-day moving average looks ready to cap that decline. Shares have retreated after jumping to their highest since May earlier this month and are down 10.8% year-on-year.

The security's 50-day call/put volume ratio of 3.01 on the International Securities Exchange (ISE), Cboe Options Exchange (CBOE) and NASDAQ OMX PHLX (PHLX) is above 90% of its levels over the past year, meaning bullish bets have been much more popular than usual.

Premium is also affordable, so now is a good time to bet on it Hershey sharesThis corresponds to the Schaeffer's Volatility Index (SVI) of 19%, which is in the low 24th percentile of annual values.