Herbalife Back to Life?

As Herbalife stock grows, Fox Business evaluates the company’s success in spite of Bill Ackman’s personal campaign against it.

Liz Claman and Charles Gasparino break down the history of Ackman’s attempt to take down Herbalife and point out gaping holes in his logic and strategy. “He has cried over what he feels are slights against the people who sell these health shakes. It’s almost like he has taken it too personally, and this company’s been around for decades. It would have gone down if it were the scheme that he alleges it to be.” Watch the video for the full story.

 

“Countdown to the Closing Bell with Liz Claman” – Fox News, 6/23/15

Liz Claman: Charlie has an excellent point to make about Herbalife. This is a tough turn, but we’re going to make it. Herbalife [is] making some major gains this year. Look at the jump year to date – that’s 80 percent. Had you bought in January, you’d be up 80 percent.

Claman to Charlie Gasparino: Charlie, what’s going on with this company?

Charlie Gasparino: I never give stock recommendations but, you know, this is kind of a sleeper stock that people haven’t realized that it’s jumped almost 100 percent. A lot of people think it’s going to go higher. Here’s what we know: It’s set to double… double since late January. So that’s a pretty big move. And here’s why it is.

Gasparino: Essentially investors believe that the FTC investigation into Herbalife, whether it’s a pyramid scheme as Bill Ackman, the short-seller says it is, a lot of… most investors are coming around to believe that this company is not going to be shut down. That if it was going to be… if they… if the FTC was going to rule it’s an illegal pyramid scheme, they would’ve done it already. That’s at least what investors say. I do know from people inside the company, what they do… what they are expecting is by the… sometime after the summer the FTC will come out with its official decision.

Gasparino: My guess: They’re gonna come out. Slap ’em around a little a little bit. Say, you know, ‘You had some deceptive marketing tactics, uh practices,’ you know. Which we should point out Herbalife has basically cleaned up since this thing began. But I, you know, my guess is that this company is not going to get shut down. That’s my guess. I’m not predict… I’m not in the prediction business, but…”

Claman: Well, Bill Ackman has been out to get this company, Judith. I mean he really has. He has cried over what he feels are slights against the people who sell these health shakes. It’s almost like he has taken it too personally, and this company’s been around for decades. It would have gone down if it were the scheme that he alleges it to be.”

Gasparino: Generally, pyramid schemes go down a lot faster. Generally pyramid schemes don’t have real products. I mean, whether you think the products are good or not… I actually think they’re pretty good… They do have products. I’ve had their protein shakes. I’ve eaten their protein bars.

Claman to Gasparino: You and I lived on the protein bars in Davos.

Gasparino: … because we were afraid of the heavy German food in Davos. And it went pretty good.

Gasparino: Yes, we did. We did!

You know, what is a pyramid scheme? A pyramid scheme is when, you know, you don’t really sell enough products, right? You just generate additional distributors. You know, and whether that’s the root of all evil… I don’t know. But it doesn’t look like they’re gonna close it down, and the market is saying that right now.

Claman: Okay, up 80 percent since the beginning of the year. Charlie, thank you. Judy, thank you very much.