Herbalife (NYSE:HLF) Rating Lowered to "Hold" at Wall Street Zen

Key Points

• Wall Street Zen downgraded Herbalife from “Buy” to “Hold,” while analysts overall maintain a “Moderate Buy” consensus with an average price target of $17.67.
• Herbalife shares opened at $13.04, with a 52-week range of $7.56 to $20.40. The company’s latest quarterly earnings missed estimates, reporting $0.51 in EPS versus the $0.54 consensus, although revenue rose 5.4% year over year to $1.33 billion.
• The company authorized a $250 million share repurchase program, allowing it to buy back up to 19.3% of outstanding shares—an indication management may view the stock as undervalued.

Herbalife (NYSE:HLF - Get Free Report) was downgraded by stock analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a research report issued to clients and investors on Sunday, Wall Street Zen reports.

Other equities analysts also recently issued reports about the company. Texas Capital upgraded Herbalife to a "strong-buy" rating in a report on Thursday, September 17th. Citigroup reiterated a "buy" rating and set a $17.00 target price (down from $21.00) on shares of Herbalife in a report on Friday, August 7th. Weiss Ratings reissued a "hold (c)" rating on shares of Herbalife in a research report on Thursday, October 22nd. UBS Group set a $21.00 price target on shares of Herbalife in a report on Thursday, September 17th. Finally, Zacks Research cut shares of Herbalife from a "strong-buy" rating to a "hold" rating in a research report on Thursday. One equities research analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating and four have assigned a Hold rating to the stock. Based on data from MarketBeat, the company has an average rating of "Moderate Buy" and a consensus price target of $17.67.

Herbalife Stock Performance

HLF stock opened at $13.04 on Friday. Herbalife has a 1 year low of $7.56 and a 1 year high of $20.40. The stock's 50 day moving average price is $12.71 and its 200 day moving average price is $14.01. The firm has a market cap of $1.37 billion, a P/E ratio of 8.41, a PEG ratio of 0.43 and a beta of 0.78.

Herbalife (NYSE:HLF - Get Free Report) last released its earnings results on Thursday, August 6th. The company reported $0.51 EPS for the quarter, missing the consensus estimate of $0.54 by ($0.03). The firm had revenue of $1.33 billion during the quarter, compared to analysts' expectations of $1.31 billion. Herbalife had a negative return on equity of 43.90% and a net margin of 3.16%. The firm's revenue was up 5.4% on a year-over-year basis. During the same period in the previous year, the firm posted $0.59 earnings per share. On average, research analysts predict that Herbalife will post 2.68 earnings per share for the current year.

Herbalife declared that its Board of Directors has initiated a share buyback plan on Tuesday, September 8th that allows the company to buy back $250 million in shares. This repurchase authorization allows the company to reacquire up to 19.3% of its stock through open market purchases. Share repurchase plans are typically an indication that the company's board of directors believes its stock is undervalued.

Hedge Funds Weigh In On Herbalife

A number of large investors have recently bought and sold shares of the business. Vise Technologies Inc. acquired a new stake in shares of Herbalife during the third quarter worth $160,000. State of Wyoming lifted its position in Herbalife by 78.3% in the 3rd quarter. State of Wyoming now owns 66,845 shares of the company's stock worth $811,000 after buying an additional 29,361 shares in the last quarter. Signaturefd LLC raised its holdings in shares of Herbalife by 135.1% during the third quarter. Signaturefd LLC now owns 2,222 shares of the company's stock worth $27,000 after acquiring an additional 1,277 shares in the last quarter. CWA Asset Management Group LLC acquired a new stake in shares of Herbalife during the 3rd quarter valued at about $1,052,000. Finally, SummerHaven Investment Management LLC grew its position in Herbalife by 3.6% in the third quarter. SummerHaven Investment Management LLC now owns 77,769 shares of the company's stock worth $943,000 after acquiring an additional 2,700 shares in the last quarter.

About Herbalife

Herbalife Ltd. NYSE: HLF is a global nutrition and wellness company that develops and distributes products through a network of independent members and distributors. Its offerings include meal-replacement shakes, protein and other dietary supplements, vitamins, sports nutrition products, and personal-care items.

Founded in 1980 by Mark Hughes, Herbalife sells its products through direct-selling channels rather than primarily through traditional retail stores. Independent distributors market the products, provide product guidance, and may operate nutrition clubs or similar community-based businesses.

The company serves customers across numerous markets in North America, Latin America, Europe, Asia-Pacific, and other regions.

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