China Looks to Crack-Down on Direct-Sales Companies (HLF) (NUS)
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Herbalife Ltd. (NYSE: HLF) and Nu Skin Enterprises Inc. (NYSE: NUS) are on watch as China mulls placing tighter restrictions on direct-sales companies.
Following recent allegations that Nu Skin has abused sales practices, Bloomberg said that China’s State Administration for Industry & Commerce is drafting new legislation which would regulate sales-force training, monitor marketing meetings, and implement tougher application procedures for those looking to expand into new regions in China.
Nu Skin last reported getting more than half its revenue from China. The stock fell earlier in January on allegations it was operating a pyramid scheme. You can read a statement from the company here.
In an email to Bloomberg over the weekend, Nu Skin said,
Herbalife is expected to report Q4 results after markets close Tuesday. The Street is looking for EPS of $1.17 on revenue of $1.22 billion, from EPS of $1.05 and revs of $1.1 billion posted in the same period last year.
Both Nu Skin and Herbalife are positive in afternoon trading.
Following recent allegations that Nu Skin has abused sales practices, Bloomberg said that China’s State Administration for Industry & Commerce is drafting new legislation which would regulate sales-force training, monitor marketing meetings, and implement tougher application procedures for those looking to expand into new regions in China.
Nu Skin last reported getting more than half its revenue from China. The stock fell earlier in January on allegations it was operating a pyramid scheme. You can read a statement from the company here.
In an email to Bloomberg over the weekend, Nu Skin said,
We remain committed to working cooperatively with the government to ensure long-term, sustainable growth in this important market ... We are dedicated to operating in full compliance with all applicable regulations as interpreted and enforced by the government of China.
Herbalife is expected to report Q4 results after markets close Tuesday. The Street is looking for EPS of $1.17 on revenue of $1.22 billion, from EPS of $1.05 and revs of $1.1 billion posted in the same period last year.
Both Nu Skin and Herbalife are positive in afternoon trading.
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