Bank of America Securities analyst Anna Lizzul reiterated a Sell rating on Herbalife (HLF – Research Report) yesterday and set a price target of $10.00.
Anna Lizzul has assigned a Sell rating to Herbalife’s stock due to a variety of concerning factors. Despite seeing some year-over-year organic sales growth in three of its five geographic regions, Herbalife’s fourth quarter results fell short of expectations, primarily because of increased SG&A expenses and a higher effective tax rate than forecasted. Additionally, even though the company is expecting to implement cost savings from its Transformation Program, these benefits are yet to fully materialize in the financial statements.
Moreover, Herbalife’s investment in the Herbalife One platform and new product innovation, while potentially beneficial for future sales, is leading to considerable capital expenditures. This, coupled with the anticipation of flat net sales and gross margin in the year ahead, has prompted a reassessment of the company’s earnings outlook, resulting in a lowered price objective. Lizzul’s valuation reflects the risks associated with the company’s ability to achieve sustainable sales growth and manages the expectations of long-term profitability amidst the current challenges.
According to TipRanks, Lizzul is ranked #1078 out of 8664 analysts.
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Herbalife (HLF) Company Description:
Herbalife Nutrition Ltd. is a holding company, which engages in the development and sale of nutrition solutions. It operates through the following segments: North America; Mexico; South and Central America; Europe, Middle East, and Africa; Asia pacific; and China. The company was founded by Mark Reynolds Hughes in February 1980 and is headquartered in George Town, Cayman Islands.
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