Najarian highlighted unusual activity in Altria calls on Friday and Monday, with traders gobbling up those options. Call options give traders the right to buy a stock at a specific price within a certain amount of time. Buying call options translates into making a bullish bet on a specific stock or asset.
Najarian said someone bought 11,400 Altria calls for 65 cents each at the $49 strike price before the news broke. He added that 11,000 calls were bought at the $50 strike price for 30 cents per option. An additional 2,400 calls expiring on Sept. 27 were bought at the $47.50 strike were also bought in that time for 98 cents each.
The $49 price strike calls shot up to $3.10 per option, bringing the trade's returns to $3.534 million. The $50 strike calls surged to $3.22 per option and a return of $3.212 million. Meanwhile, the Sept. 27 $47.50 calls jumped to $5, leading to a profit of $964,000. In all, the trades generated a profit of $7.71 million, Najarian said.
However, the timing of these trades could get the trader — or traders — into trouble. "This is pretty bold stuff, as these buys [were] just hours ahead of a MASSIVE merger will certainly draw scrutiny from the regulators," Najarian said in an email.
Najarian is the co-founder of Investitute.com, a site that tracks unusual options activity.
Disclosure: Jon Najarian is a contributor on CNBC's "Halftime Report. "