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Greenberg: Ackman's 'Anticappointment'

By: Herb Greenberg | 07/22/14 - 06:53 PM EDT

SAN DIEGO (TheStreet) -- If the 25% rise in Herbalife's (HLF) stock proves nothing else, it's that the market hates "anticappointment," as one friend puts it, referring to hedge fund billionaire activist Bill Ackman's highly promoted multi-hour presentation Tuesday on Herbalife.

Having spent 10 months investigating Herbalife for the CNBC.com documentary, "Selling the American Dream," I can say with some level of authority: There's no question that the findings by Ackman's team, after two year's of investigating, is solid. (I know what we found; they have gone well beyond that.)

In short, they alleged (actually, they stated as fact) that the company's nutrition clubs engage in phony sales to phony customers.

Pershing Square's Herbalife Presentation: Live Blog

Bill Ackman Says He’s Spent $50 Million on Herbalife Battle

Greenberg: What to Expect from Herbalife Probe

It was good stuff, but it lacked the obvious hammer-over-the-head "gotcha," such as an internal document that would prove, beyond a shadow of a doubt, that Herbalife is a pyramid scheme.

Herbalife, in a press release, as if written by a Crisis PR 101 class, didn't come right out and deny Ackman's allegations; instead it said he "overpromised and underdelivered."

Reality: The details were drowned out by the stock, and in markets like these all anybody cares about is the stock, as if it's judge and jury. It isn't, and questions about Herbalife's model are justified and overdue. But at the risk of sounding like a broken record -- the stock will do what the stock will do until regulators either give Herbalife the "all clear" or confirm what Ackman has been saying. That's really all that matters.

-- Written by Herb Greenberg in San Diego

Follow @herbgreenberg

Herb Greenberg, editor of Herb Greenberg's Reality Check, is a contributor to CNBC. He does not own shares, short or trade shares in an individual corporate security. He can be reached at herbonthestreet@thestreet.com.

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