Why Herbalife Nutrition Ltd. (NYSE:HLF) Could Be Worth Watching

Published
August 08, 2022
NYSE:HLF
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Herbalife Nutrition Ltd. (NYSE:HLF), is not the largest company out there, but it led the NYSE gainers with a relatively large price hike in the past couple of weeks. As a well-established company, which tends to be well-covered by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Herbalife Nutrition’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Herbalife Nutrition

What's The Opportunity In Herbalife Nutrition?

According to my valuation model, Herbalife Nutrition seems to be fairly priced at around 3.0% below my intrinsic value, which means if you buy Herbalife Nutrition today, you’d be paying a fair price for it. And if you believe that the stock is really worth $28.65, then there isn’t much room for the share price grow beyond what it’s currently trading. Is there another opportunity to buy low in the future? Since Herbalife Nutrition’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Herbalife Nutrition?

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NYSE:HLF Earnings and Revenue Growth August 8th 2022

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Though in the case of Herbalife Nutrition, it is expected to deliver a relatively unexciting earnings growth of 2.6%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for Herbalife Nutrition, at least in the near term.

What This Means For You

Are you a shareholder? HLF’s future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on HLF, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you want to dive deeper into Herbalife Nutrition, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 2 warning signs for Herbalife Nutrition and you'll want to know about these.

If you are no longer interested in Herbalife Nutrition, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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