Opinions
David Burrows
Herbalife Ltd.
HLF-N
DON'T BUY
Apr 21, 2015
$46.760
Stock price when the opinion was issued
0
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DON'T BUY
This is one of the great business stories of the year, and no one knows how it is going to end. Is this a giant scam, a pyramid scheme, is it going to get shut down by the marketing by the Federal Trade Commission? If you believe the numbers, it is not a bad company. It has had good growth and seems to be trading at a reasonable price. If you think that all the sales are non-repeatable and are only selling to the people who are supposed to be selling to end users and no product is getting up to the marketplace, then it is bound to collapse. He wouldn’t touch this one.
TOP PICK
Stockchase Research Editor: Michael O'Reilly HLF is a nutritional supplement and weight management product company. Management revised upward its 2021 guidance in light of pandemic related demand growth. At 13x earnings, it trades at a good discount to its peers and earnings growth has been 11% annually over the past 5 years allowing its cash flow position to grow. We would buy this with a stop-loss at $35, looking to achieve $70 -- upside potential over 50%. Yield 0% (Analysts’ price target is $69.67)
TOP PICK
Stockchase Research Editor: Michael O'Reilly HLF is a nutritional food company, who is seeing sales benefit from the need to improve diets as the pandemic winds down. Recently reported quarterly sales were up 19% and EPS improved by 71% from year ago levels. Both beat analyst expectations and management again upgraded its guidance. Marketing is focusing on how 28 NFL draft picks have been training with their products. It trades at 19x earnings, compared to peers over 34x. We would buy this with a stop loss at $39, looking to achieve $69 -- upside potential over 39%. Yield 0% (Analysts’ price target is $69.67)
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You take on some binary risks here that you don’t need to take. He would not be participating in this.