Herbalife Rises on Solid Earnings and Guidance

By Chris Lange Updated Jan 13, 12:39PM EST · Published Feb 26, 1:05PM EST

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Herbalife Ltd. (NYSE: HLF) reported its fourth-quarter financial results after the markets closed on Thursday. The company said it had $1.19 in earnings per share (EPS) on $1.1 billion in revenue. That compares to Thomson Reuters consensus estimates that called for $0.94 in EPS on revenue of $1.06 billion. In the same period of the previous year, it posted EPS of $1.41 and $1.13 billion in revenue.

Net sales, excluding currency impacts, grew by 9.7%, while reported net sales declined 3.1% primarily due to the continuing unfavorable impact of currency exchange rates.

In terms of guidance for the first quarter, the company expects EPS to be in the range of $0.97 to $1.07 and net sales growth in the range of -6% to -3%. However, the company expects currency adjusted EPS to be in the range of $1.24 to $1.34 and currency adjusted net sales to grow by 2.5% to 5.5%. Consensus estimates call for $1.09 in EPS on $1.10 billion in revenue.
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On the books, cash and cash equivalents totaled $889.8 million at the end of the quarter, compared to $645.4 million in the same period from the previous year.

Michael O. Johnson, chairman and chief executive of Herbalife, commented on earnings:

2015 was a significant year for Herbalife, as we completed the rollout of bold and important changes to the marketing plan that will enhance the long-term and sustainable growth of our business. We successfully navigated the associated short-term challenges, believing that we were making the right changes at the right time, and despite ongoing currency and macroeconomic challenges, we finished the year returning to growth.

He added:

Across the globe, we see more and more health-conscious consumers looking to take their nutrition and health more seriously. We believe Herbalife is well positioned to meet these consumers’ needs through our extensive product range and the personalized approach of our members.

Shares of Herbalife were traded up 25% to $57.19 on Friday, with a consensus analyst price target of $72.67 and a 52-week trading range of $30.27 to $61.95.

About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.