Herbalife's stock surged 5.07% in Wednesday's pre-market trading session, outperforming the broader market. The rally was fueled by the company's recent strong earnings report and the market's positive reaction to it.
According to the report, Herbalife's profits were boosted by an unusual tax benefit of $85 million. However, analysts caution that such benefits are often one-time occurrences and may not be repeated in the future, potentially impacting the company's profitability.
On the other hand, the company's earnings were also impacted by $93 million in unusual expenses, which are expected to be non-recurring. Analysts suggest that if these expenses are not repeated, Herbalife's profits could improve further in the coming year, provided other factors remain constant.
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