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what it is
Herbalife sells weight-management shakes, supplements, and skin-care products through a distributor network.
how it gets paid
Last year Herbalife made $5.0B in revenue. Weight management was the main engine at $2.75B, or 55% of sales.
why it's growing
Revenue grew 0.9% last year. This was the first quarter since 2021 in which the health and wellness company recorded a sales gain in north america.
what just happened
Herbalife's last print came in at $0.45 EPS (q) versus $0.47 expected, with quarterly revenue on the order of ~$1.25B (ballpark vs $5.0B FY—ignore any feed line that implies multi‑billion quarterly sales).
At a glance
C++ balance sheet — some cracks in the foundation
70/100 earnings predictability — reasonably predictable
5.9x trailing p/e — the market's not buying it — or you found a deal
24.5% return on capital — every dollar works hard here
xvary composite: 52/100 — below average
What they do
Herbalife sells weight-management shakes, supplements, and skin-care products through a distributor network.
Two categories drive 85% of sales: weight management at 55% and targeted nutrition at 30%. That is the whole machine in two numbers. If you use the products every day, switching means rebuilding your routine, and that is the annoying part that keeps buyers around.
How they make money
$5.0B
annual revenue · their business grew +0.9% last year
weight management
$2.75B
targeted nutrition
$1.50B
energy, sports & fitness
$0.55B
outer nutrition
$0.10B
other
$0.10B
The products that matter
shakes, supplements, and weight-management products
Nutrition Supplements
$5.0B revenue · entire business
it's the whole company: $5.0B in annual revenue with about a 5.4% net margin in the health panel on this page. if this product set loses relevance or distributor demand slips, there is no second segment waiting in the wings.
single-engine model
Key numbers
5.9x
price/earnings
Price/earnings ratio → share price divided by annual profit → 5.9x says the market is already pricing in doubt.
$2.0B
long-term debt
Debt → borrowed money → $2.0B equals 61% of capital, so flexibility is not the story here.
78.0%
gross margin
Gross margin → revenue left after product costs → 78.0% is why the business still throws off cash.
24.5%
return on capital
Return on capital → profit from each dollar invested → 24.5% says management still gets a decent return on its money.
Financial health
C++
strength
- balance sheet grade C++ — below average — limited financial resources
- risk rank 5 — safer than 5% of stocks
- price stability 10 / 100
- long-term debt $2.0B (61% of capital)
- net profit margin 5.4% — keeps 5 cents of every dollar in revenue
- return on equity 46% — $0.46 profit for every $1 investors have put in
C++ — balance sheet grade and long-term debt are flagged. this stock carries more risk than average.
Total return vs. market
You invested $10,000 in HLF 3 years ago → it's now worth $8,690.
The index would have given you $13,920.
source: institutional data · total return
What just happened
missed estimates
Herbalife's last print came in at $0.45 EPS (q) versus $0.47 expected, with quarterly revenue on the order of ~$1.25B (vs $5.0B FY).
Some raw feeds once echoed a multi‑billion quarterly revenue figure that cannot square with $5.0B annual revenue—treat that as bad field mapping. Gross margin at 78.0% matches the KPI strip; EPS lines across sources can still disagree by period.
~$1.25B
rev (q)
$0.45
eps (q)
78.0%
gross margin
EPS miss
The key number is the $0.45 EPS print versus $0.47 expected, a 4.26% miss, because the market still cares more about execution than the 55% rally.
-
shares of herbalife climbed more than 55% in price since our october review.
-
while the recent stock rally may seem surprising, despite the 2025 third quarter’s drop in adjusted earnings, the bottom-line decline is misleading.both sales and adjusted ebitda exceeded leadership’s guidance, signaling stronger operational performance than the figures suggest.
-
this was the first quarter since 2021 in which the health and wellness company recorded a sales gain in north america (+1%).
-
this was driven by solid distributor momentum and new products unveiled at recent events.these results signal a renewed growth trajectory, despite near-term earnings pressure tied to higher r&d investments. luckily, herbalife has trimmed its cost structure, positioning it to squeeze out more profits even with limited top-line support amid inflationary pressures.
-
meanwhile, product rollouts likely supported fourth-quarter performance.
source: company earnings report, 2026
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What could go wrong
Herbalife's core risk is simple: a direct-selling model with $5.0B of revenue and just 0.9% growth does not get many bad quarters for free.
med
distributor churn
Herbalife sells through independent distributors. if recruiting slows or existing sellers leave, the entire $5.0B revenue base feels it because there is no second channel doing the heavy lifting.
Revenue grew 0.9% last year. That is not much cushion if the network wobbles.
med
regulatory scrutiny
The business model itself attracts scrutiny. if rules around distributor practices or compensation tighten, recruiting economics and sales productivity could weaken at the same time.
A forced model change would hit the same engine that currently produces a 13.0% operating margin.
med
debt load
$2.0B of long-term debt equals 61% of capital. that leaves management with less room to absorb a weak selling period, a cost spike, or a stalled turnaround.
When debt is this high, a small operating miss can become a larger equity problem.
med
thin demand buffer
The products sit in a crowded wellness category. if consumer demand softens, a 5.3% net margin does not leave much extra room for discounting or promotional spend.
A low-margin category plus a distributor-heavy model is workable. It is not forgiving.
with revenue up 0.9%, net margin at 5.3%, and debt at $2.0B, this is a business that needs execution more than optimism.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
north america momentum
That +1% sales gain was the first improvement since 2021. if it repeats, the turnaround story gets less theoretical.
metric
fy2026 eps estimate
The current estimate is $2.60. if that number starts slipping while the stock keeps rallying, valuation will stop looking forgiving.
risk
distributor engagement
This business rises and falls with the field force. any sign of weaker recruitment or retention matters fast.
calendar
next earnings release
You want to see whether revenue moves meaningfully above last year's 0.9% pace and whether the slide from $0.59 to $0.47 in quarterly EPS stops getting worse.
Analyst rankings
short-term outlook
top 5%
momentum score 1 — the highest rating. in human-speak, analysts think recent price strength can keep working near term.
risk profile
high risk
stability score 5 — the stock has real drawdown risk, which matches the 10 / 100 price stability score.
chart momentum
top 20%
technical score 2 — the chart looks better than the underlying business does.
earnings predictability
70 / 100
earnings are somewhat predictable, but not enough to erase debt and model risk.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 103 buyers vs. 101 sellers in 3q2025. total institutional holdings: 0.1B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$4
$18
$13
current price
$11
target midpoint · 14% from current · 3-5yr high: $25 (+95% · 18% ann'l return)
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