Herbalife Profits Bigger Than Expected

Herbalife Profits Bigger Than Expected

Herbalife’s fourth quarter results are beyond all expectations with profits higher that any investor would have ever hoped.

With increased dividends an improved forecast for 2013 and four million shares bought back in just under two months, the nutritional company seems to be unstoppable.

However, all things are not perfect as SEC’s Division of Enforcement is conducting an investigation in Herbalife’s financial operations and has been doing so since December 2012.

Today, investors have initially raised the stock by 1 percent only to leave it up by 0.4 percent in the later part of the day.

Early controversy about the company devastated its value with stocks dropping more than 30 percent when Bill Ackman founder of Pershing Square Hedge fund released his $1 billion bet against the company and called it a “pyramid scheme”.

Things began to turn around though when Dan Loeb and Carl Ichan disclosed positions within the company and pushed for the company to be taken private as to increase shareholder value.

The report and controversy generated a huge number of stock buybacks. The company's fourth quarter results showed profits of $1,05 a 22 percent increase since 2012, also the results for its fourth quarter revenue showed a 20 percent increase since 2011.

Even with all the good news, Robert Chapman said that Herbalife's recent buybacks are an aggressive measure, as he exited his stake in the company.

Posted by James Fried on Wednesday February 20 2013, 4:14 AM EST. Ref: CNN. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0