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Herbalife (HLF) Said Considering Stock Buybacks, Other Options to Pressure 'Ack Attack'

July 29, 2016 10:44 AM EDT

(Updated - July 29, 2016 12:42 PM EDT)

Herbalife (NYSE: HLF) said to consider reinstating buybacks following FTC probe, according to Bloomberg.

Notably, the last buyback program Herbalife announced was on May 7, 2014. The company said it entered into an agreement with Bank of America Merrill Lynch to repurchase $266 million of Herbalife's common shares.

UPDATE - Stock buybacks would be one of many options for Herbalife as it looks to potentially take an offensive position against short seller Bill Ackman.

Herbalife CFO John Desimone said in an emailed statement today: From 2007 to 2014, we utilized approximately $3.7 billion for share repurchase and dividends ... Moving forward, cash management and capital structure are an important part of our strategy and all options are being considered.”

The last time Herbalife bought back stock, it stopped paying dividends and sold convertible bonds to fund the effort.

Notably, while the company bought back shares up through 2014, Ackman's Pershing Square hedge fund has been short the stock since late 2012. Shares are up about $15 since then and have recently gained over 60 percent from lows around $42 reached earlier this year.

Investors and traders might question how much more "squeeze" is there left in the stock as buybacks can help improve valuation, but overall company performance remains key.

Today, Herbalife shares are up 1.5 percent.



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