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Weighing Herbalife Ahead of Earnings

In the headlines recently due to big, opposing positions in its stock, Herbalife reports quarterly earnings Tuesday after the closing bell. But which way is the stock likely to head?

TD Ameritrade's JJ Kinahan saw investor sentiment lean in one direction.

"If you look at where the sentiment is a little bit right now, I would say the sentiment is on the calls," he said. "We've had out-of-the-money call buyers on Friday, out-of-the-money call buyers again today, so I would say from that point of view people who are speculating seem to be speculating from the long side, that earnings will be better than expected, that we will continue higher after earnings."

Options in Herbalife stock are looking at a 9.1 percent move in either direction, Kinahan added on CNBC's "Fast Money."

Activist investor Bill Ackman made headlines recently after announcing a $1 billion short in Herbalife stock, calling the company "a pyramid scheme."

(Read More: Ackman Defends Calling Herbalife a 'Pyramid Scheme')

Ackman's move sparked an on-air verbal battle with billionaire investor Carl Icahn of Icahn Enterprises, who took a long position by buying a 12.98 percent stake in the company.

(Read More: Carl Icahn: Why I'm Betting on Herbalife)

Meanwhile, hedge fund manager Dan Loeb sold part of his long position in Herbalife, according to a source.

(Read More: Ackman, Icahn Hurl Accusations, Insults)

"Why wouldn't he?" said Stephen Weiss of Short Hills Capital, adding that he expected Loeb to win, whatever his trade is.

(Read More: Hedge Fund Manager Loeb Sells Part of Long Position in Herbalife)

"My guess is he hedged that part of the position," he added. "To me, I still wouldn't play it, just because you don't know how it's going to turn out, but I would not expect any news on the government front in terms of potential investigation. You may get a buyback, though."

Enis Taner of RiskReversal.com said that Herbalife's quarterly earnings would be secondary to whether the Federal Trade Commission announces any sort of probe into the company or its business model.

"The real story is still not earnings," he said. "It's going to be any indications from the FTC on the investigation or any government official comment. I think the investigatory aspect of this story is what's more important."

Trader disclosure: On Feb. 19, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: JJ Kinahan is long AAPL; JJ Kinahan is long BAC; JJ Kinahan is long C; JJ Kinahan is long GS; JJ Kinahan is long WFC; JJ Kinahan is long CSCO; JJ Kinahan is long FB; JJ Kinahan is long MSFT; Stephen Weiss is long ESRX; Stephen Weiss is long BAC; Stephen Weiss is long TBF; Stephen Weiss is long C; Enis Taner is long GS; Enis Taner is short QCOM Put Spread; Enis Taner is long SPY Puts; Enis Taner is long HD Put Spread; Josh Brown is long AAPL; Josh Brown is long GDX; Josh Brown is long GLD; Josh Brown is long XLU; Josh Brown is long TLT; Josh Brown is long XLF; Josh Brown is long WMT.

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