Stock Market Today: Herbalife's $1 Billion Bet and Sysco's Challenge

Why Herbalife, Sysco, and Jos. A. Bank stocks are on the move today.

Feb 3, 2014 at 9:00AM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

Investors can expect a flat start to the stock market today, as the Dow Jones Industrial Average (DJINDICES:^DJI) gained an insignificant 14 points in premarket trading this morning. Janet Yellen will be sworn in as chairwoman of the Federal Reserve later today. She begins her four-year term as the central bank is steadily closing down its bond-buying program, while still promising to maintain extra low interest rates for a prolonged period.

Meanwhile, news is breaking this morning on several stocks that could see heavy trading in today's session, including Herbalife (NYSE:HLF), Sysco (NYSE:SYY), and Jos. A. Bank (NASDAQ:JOSB).

Herbalife today provided investors with a "preview" of its fourth-quarter earnings results that are due out on Feb. 18. The nutrition company sees sales growth of about 19%, higher than the 15% that the Street expected. But profit should come in at $1.15 a share, slightly below forecasts, thanks mainly to exchange rate changes. Herbalife also announced its intention to take on $1 billion in new debt, which it plans to use mostly to fund share repurchases. The stock is up 3.8% in premarket trading.

Sysco this morning posted weaker than anticipated earnings results for its fiscal second quarter. Sales grew by just 4.1% for the food giant, to $10.8 billion. Analysts expected a bigger rise, to $11.4 billion. Earnings also came in slightly below forecasts, at $0.36 a share. Sysco said the challenging environment for its restaurant customers continued in the quarter, which had the effect of pressuring sales growth and profits. Still, the company is looking forward to closing its huge merger with US Foods, which should conclude upon meeting regulatory approval. Sysco's stock is down 0.06% in premarket trading.

Finally, Jos. A. Bank this morning rejected the latest buyout offer from Men's Warehouse (NYSE:MW), saying that last week's $57.50 a share proposal "substantially undervalues" the company. Jos. A. Bank management also didn't leave much room for this process to move forward, as it declined to even join in negotiations between the two clothing giants. In its letter rejecting the offer, Jos. A. Bank suggested that Men's Warehouse, along with its largest shareholder, hedge fund Eminence Capital, could be pursing this deal only for short-term gain and not in the long-term interests of shareholders. Jos. A. Bank's stock is down 3.9% in premarket trading.

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Demitrios Kalogeropoulos has no position in any stocks mentioned. The Motley Fool has the following options: long January 2015 $50 calls on Herbalife Ltd.. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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