Sector Update: Consumer

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Consumer stocks are narrowly mixed, with shares of consumer staples companies in the S&P 500 slipping about 0.1%. Shares of consumer discretionary firms in the S&P 500 are up about 0.2%.

In company news, Herbalife ( HLF ) is up 4.6% at $69.01 a share, advancing as high as $68.48 after William P. Stiritz, chairman of Post Foods ( POST ), late Tuesday disclosed a 6.38% active stake in the consumer products company and said he would seek regular discussions with HLF management on ways to improve its operations and bolster shareholder value.

According to a new 13D filing last night, Stiritz said while he believes HLF has a sound business model and strong distribution system, the company's true value is not reflected in its share price. He said his suggestions could include possible financing or recapitalization strategies, including a potential stock buyback program, as well as steps to confront the sizable short position some investors have staked out against the company.


Stiritz now owns a total of 6.46 million HLF shares, which includes about 827,600 shares shared with other investors, according to stock ownership records. His purchases included cashing in options in mid-September to buy 101,000 shares for $20.11 to $38.87 apiece. His largest individual open-market purchase was for 235,100 shares at $72.50 each on Oct. 4.

He also purchased 1,000 call options expiring Jan 18, 2014, along with call options for another 120,000 shares expiring in January 2015. In a related move, he sold 62,100 put options expiring Jan. 18, 2014, as well as put options underlying 12,200 shares expiring in January 2015.

In other sector news,

(+) LZB, (+11.0%) Q2 earnings of $0.31 per share beats by $0.05. Revenue climbs 13.7% year over year to $366.4 mln, topping consensus view by $9.96 mln. The furniture retailer also raised its quarterly dividend by 50% to $0.06 per share, payable Dec. 10.

(-) LOV, (-14.4%) Announces proposed secondary offering by Great Hill Partners LLC and its affiliates. Size of the offering has not yet been determined. Great Hill owns just over 4.72 mln LOV shares, or about 19.7% of its stock, according to SEC records.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: HLF , POST

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As of 12/19/2014, 04:15 PM


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