Herbalife Nutrition Intrinsic Value Calculator – BofA Securities Initiates Herbalife Nutrition with Underperform Rating, Stock Plunges 12%
February 4, 2023
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Herbalife Nutrition Intrinsic Value Calculator – Herbalife Nutrition ($NYSE:HLF) is a global nutrition company whose mission is to make the world healthier and happier. Since its inception, Herbalife Nutrition has been committed to providing premium nutrition, weight-management, energy and fitness and personal care products.
However, BofA Securities recently initiated Herbalife Nutrition with an underperform rating and a $14 price target. This was due to the volatility in growth in emerging markets, leading to lower visibility. Consequently, the stock has plummeted 12% in Friday afternoon trading. The company’s overall financial performance has been mixed in recent years.
In addition, they reported higher-than-expected revenue growth in their last quarter. Moreover, Herbalife Nutrition has been making strategic investments to expand their product portfolio and strengthen their presence in the global nutrition space.
Additionally, they have invested heavily in digital marketing and e-commerce platforms to reach more customers. Despite these efforts, BofA Securities does not believe that Herbalife Nutrition can maintain its current growth rate due to the volatility in emerging markets. Furthermore, they believe that the stock is overvalued and are recommending an underperform rating with a $14 price target. As a result, the stock has fallen 12% in Friday afternoon trading. Overall, Herbalife Nutrition has made several strategic investments to expand their product portfolio and strengthen their presence in the global nutrition space. Unfortunately, BofA Securities does not believe that these efforts will be enough to offset the volatility in emerging markets and have issued an underperform rating with a $14 price target, leading to the stock’s 12% plunge on Friday afternoon.
Market Price
This is the second-worst rating given by the bank and so far, the media coverage of Herbalife Nutrition has been mostly negative. The stock opened at $17.8 and closed at $16.6, a decrease of 9.2% from its previous closing price of $18.3. The Underperform rating by BofA Securities was based on the company’s weak growth prospects and the fact that its current valuation is too high given its current position. The bank believes that Herbalife Nutrition is overvalued and does not provide sufficient value for investors.
The stock has been under pressure since last year, as the company’s sales have been declining due to the ongoing pandemic and its effects on consumer spending. The company has also been facing increasing competition in the nutrition space and its efforts to diversify its product offerings have not been successful so far. The stock’s performance on Friday has further cemented BofA Securities’ opinion that Herbalife Nutrition is overvalued, and it remains to be seen if the company can turn things around and regain investor confidence. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Herbalife Nutrition. More…
| Total Revenues | Net Income | Net Margin |
| 5.34k | 305.1 | 7.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Herbalife Nutrition. More…
| Operations | Investing | Financing |
| 384.3 | -160.9 | -323.8 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Herbalife Nutrition. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.73k | 4.09k | -13.93 |
Key Ratios Snapshot
Some of the financial key ratios for Herbalife Nutrition are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 3.3% | -3.8% | 12.3% |
| FCF Margin | ROE | ROA |
| 4.2% | -24.6% | 12.5% |
Analysis – Herbalife Nutrition Intrinsic Value Calculator
GoodWhale has conducted an analysis of HERBALIFE NUTRITION‘s wellbeing and concluded that its fair value is around $42.7. This was calculated using our proprietary Valuation Line, which is a combination of quantitative and qualitative factors. As of now, HERBALIFE NUTRITION’s share is trading at $16.6, which is 61.1% lower than its fair value. This means that the stock is undervalued by the market and presents an opportunity to buy it at a discount. The Valuation Line takes into account a variety of factors such as the company’s financial performance, competitive advantages, management team, and industry trends. It also considers the macroeconomic environment and the overall market sentiment. The analysis of HERBALIFE NUTRITION provides investors with a comprehensive view of its wellbeing and helps them make informed decisions about their investments. Therefore, investors should take advantage of the current undervaluation and consider investing in HERBALIFE NUTRITION stock. More…
Peers
They have a broad product line including weight management, targeted nutrition, and energy and fitness products. They have a presence in over 90 countries and 6.4 million independent distributors. Health and Happiness (H&H) International Holdings Ltd is a Hong Kong based company with a portfolio of health and wellness brands. Natures Sunshine Products Inc is a Utah based company that manufactures and sells over 600 nutritional and personal care products. Nu Skin Enterprises Inc is a Utah based company that markets premium-quality health and beauty products.
– Health and Happiness (H&H) International Holdings Ltd ($SEHK:01112)
Health and Happiness (H&H) International Holdings Ltd is a health and wellness company that focuses on improving the lives of people around the world. The company has a market cap of 4.77B as of 2022 and a Return on Equity of 12.89%. H&H International Holdings Ltd is committed to providing quality products and services that improve the health and happiness of people around the world.
– Natures Sunshine Products Inc ($NASDAQ:NATR)
Natures Sunshine Products Inc is a market leader in the dietary supplement industry. The company has a strong focus on research and development to create products that are backed by science. Natures Sunshine Products Inc has a market cap of 173.79M as of 2022, a Return on Equity of 9.59%. The company has a strong focus on quality, safety and efficacy of their products. Natures Sunshine Products Inc is committed to providing products that improve the lives of their customers.
– Nu Skin Enterprises Inc ($NYSE:NUS)
Nu Skin Enterprises, Inc.’s market cap is $2.02 billion as of 2022 and its return on equity is 16.08%. The company is involved in the direct selling of premium quality skin care products, nutritional supplements, and other personal care products.
Summary
Investors analyzing Herbalife Nutrition have recently received a warning from Bank of America Securities, which initiated coverage with an Underperform rating and sent the stock price plunging 12% in one day. So far, the news and media coverage of Herbalife Nutrition have been mostly negative. Due to the recent news, investors may want to approach investing in Herbalife Nutrition cautiously. It is important to do thorough research and consider all potential risks before investing in any company.
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