Herbalife (HLF) Shares Continue Lower Despite Numerous 'Buy the Weakness' Calls

Shares of Herbalife (NYSE: HLF) are continuing lower Wednesday despite a number of analyst reports which suggest "buying the dip" in the stock.

Herbalife shares closed nearly 20 percent lower on Tuesday following some questioning from hedge fund manager David Einhorn on the company's first-quarter conference call. Einhorn was concerned with Herbalife's distribution model and disclosures on sales. Specifically, the famed short seller asked about the company's percentage of sales to consumers who are not distributors.

The company issued a statement late Tuesday afternoon which insisted Einhorn's inquiries were "no new subjects or concerns."

Around the Street:

• DA Davidson - "If anyone else had asked the question we would have wondered why time was being devoted to such basic inquiries... This was an excellent quarter from an excellent company with high ethics and strong accounting. We have no problem remaining bullish no matter who is asking the questions."
  
• Auriga - upgraded the stock to Buy this morning. "We did not hear any new material issues raised but his questions were concerns that have previously been raised. As a multi-level marketer, Herbalife's operating structure is different than traditional retailers..."
  
• Wedbush - "Virtually the same allegations were made in 2007 against Herbalife and competitor USANA (Nasdaq: USNA), prompting an investigation by the SEC, which ended up completely exonerating both companies. In retrospect, the initial selloffs in the share prices for both stocks...would have made excellent buying opportunities over the long run." Called the quarter "another impressive beat & raise..."

Amid the numerous reassurances, shares of Herbalife are currently down more than 5 percent to around $53.23. The stock is just barely off Tuesday's session lows.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Fisker (FSR) files form 10-K, sees more job cuts, reiterates going concern doubts
• Centessa Pharmaceuticals (CNTA) Announces Pricing of $100 Million Public Offering of American Depositary Shares
• Advent Technologies (ADN) Receives Nasdaq Notice on Late Filing of its Form 10-K