Herbalife Ltd, (NYSE: HLF)
Shares of Herbalife, which had been experiencing some nice uptrending price action since the beginning of the year – up nearly 40% – fell in the after-hours trading session on Tuesday August 1, 2017.
Shares which had been down as low as $63 in the after market closed at $64 which was down -$2.52 or3.79%. While the company reported fairly decent earnings for the second quarter of their fiscal year, it was their forward looking third quarter’s guidance that upset investors and sent the shares lower.
Earnings came in at $1.61 per share which compares to a loss of $0.28 per share in the same quarter a year prior. For their upcoming third-quarter, the company expects earnings of between $0.65 and $0.85 which would fall short of the expected $1.22 a share by analysts.
It will be interesting to see how the trading goes after the Market opens on Wednesday morning, as there is a short float of 26% – this is huge, almost one-third of the shares are sold short- because shares have ranged in a 52-week range from $47.62 to $74.49.
Company Comments
Rich Goudis, CEO of Herbalife, stated,
“With the successful implementation of tracking consumer retail transactions in the U.S., we are now entering into a new chapter for the company. Through technology innovations, and changes in our marketing plan here in the U.S., we are now collecting millions of customer receipts each month, and we know this will help our distributors create more compelling connections with their customers everywhere and anytime.”
“With much of the transition behind us, we can now pivot back to an acute focus on growth.”
Mr Goudis added this to say about the promotion of Dave Pezullo:
“Dave and I have a long history and have accomplished major milestones together at Herbalife including the establishment of world-class manufacturing facilities, laboratories and quality control infrastructure, sophisticated supply chain systems, and R&D centers worldwide that have set the standard in our industry for product quality,”.
Dave is a proven leader and shares my vision and passion for innovation, and I couldn’t be more pleased to have him on our leadership team in his new role as COO.”
The Price Charts
The above price chart shows the intraday action on Tuesday on the left, and the after I was accession on the right in the Shaded area. You can see how shares initially rose in the aftermarket and then subsequently dropped once news spread that guidance was not so great.
The above price chart shows the action from the beginning of 2017 up to the present. You can see how the price has respected and upper resistance red trend line and a lower support green trend line. The shaded area on the right is where shares will likely open in the morning on Wednesday for trading.
Company Profile
Herbalife Ltd., a nutrition company, develops and sells weight management, healthy meals and snacks, sports and fitness, energy and targeted nutritional products, and personal care products. It offers science-based products in four principal categories, including weight management; targeted nutrition; energy, sports, and fitness; and outer nutrition.
The companys weight management product portfolio includes meal replacement products, protein shakes, drink mixes, weight loss enhancers, and healthy snacks; targeted nutrition products comprise dietary and nutritional supplements containing herbs, vitamins, minerals, and other natural ingredients; and outer nutrition products consist of facial skin, body, and hair care products.
It also provides literature, promotional, and other materials, including start-up kits, sales tools, and educational materials. The company offers its products through retail stores, sales representatives, sales officers, and independent service providers.
It operates in North America, Mexico, South and Central America, Europe, the Middle East, Africa, the Asia Pacific, and China. The company was founded in 1980 and is based in Grand Cayman, the Cayman Islands.-YahooFinance
