Herbalife (HLF) AI Stock Analysis

• Market Cap: $842.27M
• Dividend Yield: N/A
• Average Volume (3M): 1.87M
• Price to Earnings (P/E): 3.0
• Beta (1Y): 0.45
• Revenue Growth: -2.45%
• EPS Growth: 100.59%
• Country: US
• Employees: 8,600
• Sector: Healthcare
• Sector Strength: 41
• Industry: Packaged Foods
• EPS (TTM): 0.59
• Shares Outstanding: 101,846,730
• 10 Day Avg. Volume: 1,655,060
• 30 Day Avg. Volume: 1,867,219
• PEG Ratio: 0.28
• Price to Book (P/B): -1.09
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.91
• Enterprise Value/Market Cap: 3.42
• Enterprise Value/Revenue: 0.14
• Enterprise Value/Gross Profit: 0.75
• Enterprise Value/Ebitda: 1.46
• 1Y Price Target: $12.50
• Price Target Upside: 51.15% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 68 Neutral
• Price Target: $8.50 ▲(2.78%Upside)

Herbalife's overall stock score reflects strong operational efficiency and an attractive valuation, offset by financial stability concerns due to high leverage and declining sales. Technical analysis supports a cautiously optimistic view, while the earnings call highlights both strategic initiatives and market challenges.

Positive Factors

Acquisitions

Herbalife announced it entered into a binding agreement to acquire Pro2col Health, LinkBiosciences, and Pruvit Venture, which could become a powerful tool to improve engagement and retention of customers and increase distributor productivity.

Distributor Growth

The growth of new worldwide distributors accelerated, marking the third consecutive quarterly increase.

Management Vision

New CEO Stephan Gratziani has a long-term vision and connects with top distributors, contributing positively to the company's future.

Negative Factors

Macro Pressures

Macro pressures present hurdles across multiple geographies, affecting new distributor productivity.

Regional Performance

Revenue remains shaky with volume points growing in just one region while three others declined.

Web Traffic

Globally, the trends across web & app traffic have been consistently weak with a notable worsening in average unique visitors to myherbalife.com.

Herbalife Business Overview & Revenue Model

Company Description

Herbalife Nutrition Ltd. offers nutrition solutions in North America, Mexico, South and Central America, Europe, the Middle East, Africa, China, and rest of Asia Pacific. The company provides products in the areas of weight management; targeted nutrition; energy, sports, and fitness; and outer nutrition. It offers weight management products, including meal replacement products, protein shakes, drink mixes, weight loss enhancers, and healthy snacks; targeted nutrition products, which comprise functional beverages, and dietary and nutritional supplements that contain herbs, vitamins, minerals, and other natural ingredients; outer nutrition products, such as facial skin, body, and hair care products; and energy, sports, and fitness products, including N-R-G tea and energy drink products. The company also provides literature, promotional, and other materials that comprise start-up kits, sales tools, and educational materials. It offers its products through independent service providers and sales representatives, as well as through company-operated retail platforms. The company was formerly known as Herbalife Ltd. and changed its name to Herbalife Nutrition Ltd. in April 2018. Herbalife Nutrition Ltd. was founded in 1980 and is headquartered in Los Angeles, California.

How the Company Makes Money

Herbalife makes money primarily through the sale of its nutritional products via a network marketing model. The company offers a range of products including protein shakes, teas, aloes, vitamins, and skincare products. Herbalife's revenue model is heavily reliant on independent distributors who purchase products at a discount and sell them at retail prices, earning a profit. Additionally, distributors can recruit others to join the business, earning commissions on their sales, which creates a multi-level marketing structure. Herbalife also earns revenue through strategic partnerships and sponsorships, particularly in sports nutrition, where it aligns with professional athletes and teams to promote its brand and products.

Herbalife Financial Statement Overview

Summary

Herbalife's financial performance shows strong operational efficiency with a high gross profit margin of 77.39%. However, declining revenue, reduced net profit margins, and significant financial leverage with negative equity pose risks to financial stability. Cash flow generation is stable, but financing outflows raise liquidity concerns.

Income Statement

Herbalife's income statement shows a declining trend in total revenue over the past few years, with a recent TTM total revenue of $4.95 billion, down from $5.20 billion in 2022. The gross profit margin remains strong at approximately 77.39% for the TTM period, indicating efficient cost management. However, the net profit margin has decreased to 5.66% from higher levels in previous years, highlighting challenges in maintaining profitability. The EBIT margin for TTM stands at 9.08%, and EBITDA margin at 10.64%, both reflecting a stable yet pressured operating environment.

Balance Sheet

The balance sheet reveals significant financial leverage, with a negative stockholders' equity of -$736 million as of TTM, indicating high debt levels relative to assets. The debt-to-equity ratio is not calculable due to negative equity, raising concerns about financial stability. The equity ratio is also negative, further emphasizing the risk associated with high indebtedness. Despite these challenges, total assets remain substantial at $2.68 billion.

Cash Flow

Herbalife's cash flow statement shows a modest free cash flow growth, with TTM free cash flow of $164.4 million, slightly higher than the previous year's $163.4 million. The operating cash flow to net income ratio is 0.97, indicating efficient cash conversion from net income. However, the high levels of financing cash outflows raise concerns about reliance on debt to fund operations.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
4.95B	4.99B	5.06B	5.20B	5.80B	5.54B
	Gross Profit
3.83B	3.89B	3.87B	4.03B	4.56B	4.39B
	EBIT
449.60M	385.90M	356.40M	545.20M	734.10M	640.60M
	EBITDA
560.40M	509.10M	482.20M	672.70M	854.60M	740.90M
	Net Income Common Stockholders
280.40M	254.30M	142.20M	321.30M	447.20M	372.60M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
454.20M	415.30M	575.20M	508.00M	601.50M	1.05B
	Total Assets
2.69B	2.73B	2.81B	2.73B	2.82B	3.08B
	Total Debt
2.85B	2.47B	2.77B	2.88B	2.96B	2.64B
	Net Debt
2.40B	2.05B	2.19B	2.38B	2.36B	1.59B
	Total Liabilities
3.91B	3.53B	3.87B	4.00B	4.21B	3.93B
	Stockholders Equity
-1.22B	-801.10M	-1.06B	-1.27B	-1.39B	-856.10M
Cash Flow		Free Cash Flow
164.40M	163.40M	222.50M	196.10M	308.90M	516.60M
	Operating Cash Flow
271.80M	285.40M	357.50M	352.50M	460.30M	628.60M
	Investing Cash Flow
-70.60M	-84.60M	-134.80M	-156.20M	-156.40M	-123.20M
	Financing Cash Flow
-249.30M	-335.30M	-148.30M	-264.70M	-728.60M	-320.90M

Herbalife Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HLF, the sentiment is Positive. The current price of 8.27 is above the 20-day moving average (MA) of 7.38, above the 50-day MA of 7.25, and above the 200-day MA of 7.31, indicating a bullish trend. The MACD of 0.23 indicates Negative momentum. The RSI at 63.15 is Neutral, neither overbought nor oversold. The STOCH value of 80.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HLF.

Herbalife Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CDNA	77 Outperform	$1.11B	17.23	21.57%	―	25.92%	―
USNA	68 Neutral	$574.71M	16.90	6.78%	―	-2.69%	-43.24%
HLF	68 Neutral	$842.27M	3.01	-31.74%	―	-2.45%	100.59%
AORT	68 Neutral	$1.25B	―	-7.25%	―	5.94%	-115.82%
AVDL	66 Neutral	$989.64M	―	-34.65%	―	252.64%	85.10%
HSTM	64 Neutral	$858.68M	45.02	5.40%	0.42%	3.36%	7.51%
Sector *	54 Neutral	$5.37B	3.35	-45.10%	2.79%	16.77%	-0.01%

Herbalife Corporate Events

Herbalife Reports Q1 2025 Financial Results

Herbalife reported its financial results for the first quarter of 2025, with net sales reaching $1.2 billion, down 3.4% from the previous year, but showing a 1.4% increase on a constant currency basis. The company exceeded its guidance for adjusted EBITDA and improved its gross profit margin. Recent strategic acquisitions, including Pro2col Health LLC and Pruvit Ventures, are expected to enhance Herbalife’s product offerings and market reach. The company also revised its full-year guidance, narrowing its net sales range and raising its adjusted EBITDA expectations.