Herbalife Ltd. (HLF) Has Year of Growth

Herbalife Ltd (HLF) headquartered in the Grand Cayman is a network marketing company. Those two facts should cause everyone to wonder how it has performed so well over the past 12 months, but that is exactly what it has done. The company sells weight management and supplements in addition to energy and sports products.

The company sells its products through the traditional means of network marketing with independent distributors and also stores in China. The company stock is not a member of any index groups at this time. Yet, Herbalife Ltd. offers a dividend of $1.00 with a yearly yield of 1.70%. The stock has hit a new 52-week high three times during the month of September with the latest new high on the 13th of September at $59.80 a share.

The company will be making their next earnings announcement on November 10th, so watch for new developments leading up to the announcement. The last four earnings announcements have beaten street expectations with the last earnings report having a profit of $1.32 a share. Sales have also continued to rise along with earnings with estimates for this year increasing 16% over the past fiscal year.

Analyst are now expecting $4.42 a share for the year in profit with the current quarter making $1.03 a share. This is an increase from $3.90 a share and $0.98 a share respectively from just two months ago. The Price to Earnings ratio is 15.17 while the PEG ratio is 1.01 according to Zacks. This is right at fair value, meaning any significant increase in stock price will need to be in sync with earnings to keep the price within value investing’s desired range.

The company recently made the InformationWeek 500 list, ranked at number 35. The use of an innovative mobile application by distributors along with the use of technology within the internal company, provided the high ranking for 2010.

Options are not wildly traded for the stock but there is some liquidity in the November contracts at this time. The Chart Trend for the stock has been a buy for the past three months will short periods of caution. The chart is currently in a long trend with a small range formed at the top between $60.15 and $58.25 a share. You could purchase shares at the bottom of the range and being to sell as the price extends above the range.

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