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Herbalife Ltd. Message Board

  • squeezetracker squeezetracker Sep 28, 2013 9:27 AM Flag


    1. The company has ample capacity, will and venom to use leverage to mash out the naysayers. Davidson's analyst has published that PWC back audit and a $2B leveraged buyback program will be announced before the end of September (that would be Monday friends):

    IBD Excerpts:

    Herbalife Stock Hits New High As Ackman Endgame Near
    09/17/2013 02:26 PM ET

    Herbalife (HLF) shares shot up to a new high as growing expectations for a share buyback put the ongoing fight with activist investor Bill Ackman closer to a possible endgame. D.A. Davidson, which has a buy rating on the nutritional and weight-loss products company, expects Herbalife to launch an aggressive leveraged buyback when it reports audited financials later this month. Earlier this year, Herbalife hired PwC to audit its financial statements after KPMG resigned due to insider-trading charges by one of its auditors. And a repurchase — seen at $2 billion for $75 per share — could quiet down short sellers like Ackman.

    2. Elementary valuation metrics (P/E ttm and ftm, PEG, operating margin vs broad market) make it obvious the stock merits a premium valuation yet,despite stock progress since early 2013, it continues to trade at a discount to SP500.

    3. As Stiritz's recent entrance makes obvious, It is VERY early in this growth story. Independently the company has a very long runway in China (recent expanded marketing authority from the chinese health ministry), Brazil (50% growth yoy and just getting going), Mexico (long a huge market for HLF and yet still growing in a major way), still high teens growth in the U.S., and the ROW markets all open for business for HLF expansion from baselines.

    4. Ackman's tactics to discredit the story and products have failed, but so what. Others have tried previously to put this company's future in doubt only to be proven wrong by the continued, steady progress of this high quality, committed management team and BOD.

    Our PT was recently upped to $90 by EOY.

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