Herbalife Third Quarter Earnings Sneak Peek

Herbalife Ltd. (NYSE:HLF) will unveil its latest earnings on Monday, October 29, 2012. Herbalife is a marketing company that sells weight management, nutritional supplement, energy, sports and fitness products and personal care products.

Herbalife Ltd. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $1.01 per share, a rise of 16.1% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from 99 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at $1.01 during the last month. Analysts are projecting profit to rise by 19.9% versus last year to $3.97.

Past Earnings Performance: Last quarter, the company beat estimates by 14 cents, coming in at net income of $1.10 a share versus the estimate of profit of 96 cents a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the second quarter, profit rose 20% to $133.4 million ($1.10 a share) from $111.2 million (88 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 17.3% to $1.03 billion from $879.7 million.

Stock Price Performance: From September 25, 2012 to October 23, 2012, the stock price rose $6.30 (13.8%), from $45.62 to $51.92. The stock price saw one of its best stretches over the last year between October 10, 2012 and October 18, 2012, when shares rose for seven straight days, increasing 6.5% (+$3.25) over that span. It saw one of its worst periods between August 16, 2012 and August 31, 2012 when shares fell for 12 straight days, dropping 8.8% (-$4.67) over that span.

Wall St. Revenue Expectations: Analysts predict a rise of 11.4% in revenue from the year-earlier quarter to $997 million.

Key Stats:

With double-digit revenue growth the past four quarters, this earnings release is a chance to keep that positive trend going. The company has averaged year-over-year revenue growth of 22.1% over the last four quarters.

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 30.1% in the fourth quarter of the last fiscal year and 23.5% in the first quarter before increasing again in the second quarter.

Analyst Ratings: With nine analysts rating the stock a buy, none rating it a sell and none rating the stock a hold, there are indications of a bullish stance by analysts.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.49 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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