Stock Market Today: 3D Systems’ Hit And Herbalife’s Ackman Battle

Why 3D Systems, Herbalife, and Alexion Pharmaceuticals stocks are on the move today.

Mar 10, 2014 at 9:00AM
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Investors can expect a flat start to the stock market today: The Dow Jones Industrial Average (DJINDICES:^DJI) has lost a modest 40 points in pre-market trading. Stocks are near record highs as we pass the five year anniversary of the start of the bull market. World indexes were mostly lower in overnight trading, led by a 3% drop in Chinese shares after new data showed an 18% plunge in the nation's exports for February. Economists were looking for China to post a more modest 7.5% trade dip.

Closer to home, news is breaking on several stocks this morning that could see heavy trading in today's session, including 3D Systems (NYSE:DDD), Herbalife (NYSE:HLF), and Alexion Pharmaceuticals (NASDAQ:ALXN)

3D Systems shares are down 4.3% in pre-market trading after the company was profiled in a Barron's cover story over the weekend titled "Beware 3-D Printing!" The article doesn't break much new ground; arguing, as many others have, that 3-D printing stocks seem overvalued on earnings and sales metrics. Still, Barron's suggests that 3D Systems' stock could fall an eye-popping 80% while still being generously valued. That's an extreme proposition that might convince some shareholders to sell today, but long-term investors should be used to volatility in the space and are better off focusing on 3D Systems' business fundamentals.

Herbalife's long battle with activist hedge fund manager Bill Ackman was the focus of a front page article in The New York Times this morning. The newspaper chronicles what amounts to a coordinated campaign against Herbalife by Ackman's Pershing Square Capital Management, which has a $1 billion short position on the company that the hedge fund manager has described as a pyramid scheme. The campaign succeeded in gaining support from government regulators, political leaders, and community groups while in some cases using questionable tactics, the Times reported. For example, many of the letters from diverse organizations pressuring state and federal regulators used the exact same language, and some of their signatories do not remember sending them. Herbalife's stock is down 2.2% in pre-market trading.

Finally, Alexion Pharmaceuticals this morning boosted its 2014 sales and earnings outlook after reaching an agreement with the French government regarding sales of its blood-disorder fighting drug Soliris. Alexion will be reimbursed for past sales of Soliris this year, which will help push sales to $2.16 billion, above the prior guidance for $2 billion in revenue. Its profit forecast was even more dramatically scaled up from $3.75 a share to about $4.40 a share including the Soliris deal. Alexion's stock is up 3.1% in pre-market trading.

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Demitrios Kalogeropoulos owns shares of 3D Systems. The Motley Fool recommends 3D Systems. The Motley Fool owns shares of 3D Systems and 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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