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Herbalife Ltd. Message Board

  • squeezetracker squeezetracker Sep 28, 2013 8:52 AM Flag

    STOCK READY TO RIP (PART 2): BASIC QUANT PERSPECTIVES

    1. The company continues to UPOD, extending the string of record quarters on revenue and earnings growth and consistently beating guidance and consensus.

    2. ebitda continues to surpass guidance and consensus.

    3. Company has ample flexibility to ramp buybacks with previously announced plans to ramp to well beyond 10% incremental repurchases prior to EOY. Current Q buybacks likely to surpass street estimates.

    4. Unspoken, poorly understood float compression program only just beginning. Pulled borrow extension likely to come precisely on track with substantial increase in company share repurchases, including imminent leveraged buyback program due to be announced Monday (based on Davidson analyst's published comments of "prior to end of September.

    5. Company likely to significantly outperform guidance again this quarter.

    6. Well publicized short positions are likely hedged, but time decay and replacement costs further strain their capacity to continue to restrain upside price movement on institutional volume.

    7. Weak retail shorts and daytraders have been thrashed on the strength of the upward price move, yet the aggregate short interest exceeds Ackman's stated position indicating many pm have active SI hedges offsetting larger long positions. In addition to players including Icahn and Stiritz who continue to advocate that the shares are significantly undervalued, these SI hedges represent tremendous firepower that is likely to join the sotrm higher for these shares as soon as the catalysts kick in (call exercises, large OTM put expiry, corporate share repurchases accelerated, and or Dutch/other tenders or strategic transactions announced).

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HLF
61.17+0.04(+0.07%)Sep 27 4:02 PMEDT