Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Herbalife as such a stock due to the following factors:
- HLF has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $151.7 million.
- HLF has traded 1.9 million shares today.
- HLF is down 3% today.
- HLF was up 6.5% yesterday.
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More details on HLF:
Herbalife Ltd., through its subsidiaries, produces and distributes weight management, healthy meals and snacks, sports and fitness, energy and targeted nutritional products, and personal care products worldwide. The stock currently has a dividend yield of 1.8%. HLF has a PE ratio of 13.6. Currently there are 6 analysts that rate Herbalife a buy, no analysts rate it a sell, and 1 rates it a hold.
The average volume for Herbalife has been 2.7 million shares per day over the past 30 days. Herbalife has a market cap of $6.7 billion and is part of the consumer goods sector and consumer non-durables industry. The stock has a beta of 1.74 and a short float of 29.5% with 9.33 days to cover. Shares are up 113.2% year to date as of the close of trading on Wednesday.
rates Herbalife as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, impressive record of earnings per share growth, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 3.0%. Since the same quarter one year prior, revenues rose by 19.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 34.69% and other important driving factors, this stock has surged by 43.91% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, HLF should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- HERBALIFE LTD has improved earnings per share by 34.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, HERBALIFE LTD increased its bottom line by earning $4.00 versus $3.32 in the prior year. This year, the market expects an improvement in earnings ($5.25 versus $4.00).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Personal Products industry average. The net income increased by 26.9% when compared to the same quarter one year prior, rising from $111.87 million to $141.95 million.
- The gross profit margin for HERBALIFE LTD is rather high; currently it is at 51.32%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 11.69% is above that of the industry average.
- You can view the full Herbalife Ratings Report.