Herbalife Stock Climbs Over 16%, As This Analyst Says There's Good Reason To Be Bullish

Herbalife Nutrition Ltd’s HLF stock is trading at record lows, with valuation significantly discounted versus peers, offering an attractive entry point, according to Jefferies.

The Herbalife Nutrition Analyst: Chris Neamonitis upgraded the rating for Herbalife Nutrition from Hold to Buy, while keeping the price target unchanged at $26.

The Herbalife Nutrition Thesis: The company’s stock valuation already reflects a potential steep decline in productivity following the deceleration in the second half of 2021 and the first quarter of 2022 as well as guidance revisions, and recent reduction in estimates for peers, Neamonitis said in the upgrade note.

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The current share price also reflects “sustained input cost driven margin pressures (with no benefit from recent pricing action),” he added.

Alternative data for June points towards improving distributor engagement, with web traffic increasing by 26%, the analyst mentioned. “Core distributors are 50% of total volume and higher engagement helps offset productivity pressures from 2020-21 cohorts,” he added.

HLF Price Action: Shares of Herbalife Nutrition had risen by 16.47% to $22.91 at the time of publication Tuesday.

Photo: Courtesy of Ernesto Flores on Flickr