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$43.49 -$0.16 (-0.4%)

04:00 PM EDT on 10/15/21

Herbalife Ltd (NYSE:HLF)

CAPS Rating: 1 out of 5

A global network marketing company that sells weight management, nutritional supplement and personal care products.

Current Price $43.49 Mkt Cap $4.6B
Open $43.69 P/E Ratio 10.08
Prev. Close $43.49 Div. (Yield) $0.00 (0.0%)
Daily Range $43.43 - $44.08 Volume 405,461
52-Wk Range $41.31 - $59.00 Avg. Daily Vol. 1,342,448


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All Players

429 Outperform
246 Underperform

All-Star Players

69 Outperform
54 Underperform

Wall Street

0 Outperform
0 Underperform

Top NYSE:HLF Bull/Bear Pitches

The best Bull and Bear pitches based on recency and number of recommendations.

callumturcan (86.71)
Submitted February 06, 2013

This company is not a pyramid scheme. Out of the 13 pyramid schemes brought to the FTC, they were all younger than 10 years and 11 of them were younger than 5. This company is over 32 years old and has constistently grown its EPS by double digits,… More

TMFMattyA (99.95)
Submitted January 14, 2014

Now that the re-audit is done and there were no restatements, and the fervor over Bill Ackman's short from late 2012 is mostly in the rear view mirror, I think Herbalife's value will now be weighed by the company's business model going forward --… More


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Recent Community Commentary

Read the most recent pitches from players about HLF.


Member Avatar Default (36.59) Submitted: 1/23/2021 8:22:20 AM : Underperform Start Price: $50.25 NYSE:HLF Score: +29.55

multi-level marketing


Member Avatar kingmax48 (55.52) Submitted: 5/23/2019 6:46:48 PM : Underperform Start Price: $44.16 NYSE:HLF Score: +58.44

fraud....$0 PT


Member Avatar XMFRendezvous (98.04) Submitted: 4/23/2018 5:00:35 PM : Underperform Start Price: $51.17 NYSE:HLF Score: +82.22

Herbalife is a Pyramid Scheme.

Have you ever had someone from your high school hit you up on Facebook randomly and say something like "Hey, are you interested in making some extra cash on the side? Some friends of mine are starting a business, and I think you'd be a good fit."

Every time I get those messages I say "get out while you can."

You can't talk Herbalife without mentioning Bill Ackman, the activist hedge fund manager who took a 1 billion dollar bet against Herbalife in a very public attempt to sink the company. The problem with shorting is that it invites a short squeeze. And that squeeze was Carl Icahn who bought up Herbalife. Some even think this move was just as much in spite of Bill Ackman as it was taking advantage of an opportunity to profit from high short interest.

Quick short squeeze lesson: Essentially, when you short a company, you have to "buy-back" the shares you borrowed to exit the position. If you are wrong and shorts are "squeezed" into cutting their losses they have the buy the shares at higher prices. In the case of Ackman's billion dollar short, that would send the stock up significantly.

The point here is that much of Herbalife's stock price is financial engineering and NOT business fundamentals. Herbalife has bought back stock and manipulated the float (shares available) of the stock in an attempt to clear Ackman's barrage. With Ackman out of the picture, they can successfully point to their high stock price and show their "employees" and the world that Ackman's claims were wrong. Why may be false equivocation -- but it works.

However, what they're left with are a few major shareholders coming off a big gain in which business fundamentals remain questionable. So my question is... what happens when Icahn and others sell out?

Icahn is a prudent investor, but he is not as much of a business-focused as Ackman is. Ichan tends to focus more on cost structures and technicalities. In Icahn's twitter bio he says "some people get rich studying artificial intelligence. Me, I make money studying natural stupidity." Some even consider his knowledge of Herbalife as a buisness to be pretty minimal (all things considered), which signals he may not be in interested in Herbalife for the long haul.

With Ackman out of the picture, the stock is at all-time highs. But Let's look at the business.

I don't like to call tops but...

Growth? Declining -3%
EPS? Lower than it has been past 3 years, yet the stock is up
Operating Margin? Declining, poor compared to peers
Net Margin? Declining, poor compared to peers
Inventory Turnover? Down i.e. products are not selling.

P/E 39X
Forward P/E 20X

That assumes the company will continue to make as much money as it does today for 20 years. I just can't see that happening.

Walmart- the best retail operator in class trades at 17X Forward P/E

That does not make sense to me.

Other red flags:
-They are buying back all time highs -- Not smart
-Volume points are decreasing -3.6% (volume points are considered the drivers of growth for multi-level marketing companies)
-They have stopped reporting how many "members" they have, which likely means it is now lower.

My last point is that Herbalife is simply an unethical organization. I think objectivly Ackman was spot on with his analysis of Herbalife. But Ackman was betting against human nature...and he might have gotten away with it if it wasn't for Carl Ichan

Herbalife uses aggressive, aspirational advertising techniques that pull on on people's heartstrings. Often, they are roping up people who are uneducated and poor and selling them very expensive products with the promise of owning your own business. You couple that with the fact that they sell inspirational nutritional products, and you have an addictive pyramid scheme.

It is hard to tell people they are wrong about Herbalife, it's like pouring water on a grease fire-- people's pride is at stake, and Herbalife's management team knew how to burn Ackman.

The word does not need this company in an internet age when we can get anything we want for cheap. We do not need our youth and our poor succumbing to false bu
isness promises and "millionaire mindset" advertising. It is not entrepreneurial and wastes time. Selling overpriced shakers to people certainly does not make them more fit, especially financially.

I truly believe that by opening up a "short" put option position on Herbalife I am doing the most socially conscious investing I can do.


Find the members with the highest scoring picks in HLF.

Score Leader


dlomax77 (73.58) Score: +893.19

The Score Leader is the player with the highest score across all their picks in HLF.

Member Name Member
Call Time
Score Commentary
smisra2 93.72 3/23/2009 Outperform NS $3.23 +1,247.05% +461.35% +785.71 0 Comment
Dann68 71.64 3/24/2009 Outperform 3Y $3.31 +1,213.12% +454.00% +759.11 0 Comment
charliebottle < 20 3/24/2009 Outperform 5Y $3.33 +1,208.65% +454.28% +754.38 0 Comment
GoingPro 73.44 11/24/2008 Outperform NS $3.64 +1,095.29% +428.58% +666.71 0 Comment
sushmitasri < 20 3/27/2009 Outperform 3Y $3.69 +1,079.64% +448.60% +631.04 2 Comments
lawjeseps 71.40 11/17/2008 Outperform 5Y $3.87 +1,023.66% +429.98% +593.68 0 Comment
DOCFOSTER54 28.96 4/3/2009 Outperform 1Y $3.85 +1,031.81% +439.35% +592.46 0 Comment
notzia < 20 4/3/2009 Outperform 5Y $3.83 +1,035.15% +443.26% +591.89 2 Comments
lawjes < 20 11/11/2008 Outperform 5Y $4.20 +937.04% +406.79% +530.25 0 Comment
criticalmass2035 57.99 11/11/2008 Outperform 3Y $4.29 +914.20% +403.27% +510.93 0 Comment

Wall Street

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