Herbalife (HLF) Exposed!

Here is a quote from Seekingalpha's comment section:

"I am in the legal field and am interested in the legal pyramid allegations. From a strictly legal point of view I do NOT believe Ackman will succeed as using the FTC definition I do not think this can be classified as a pyramid scheme. However, I do believe that HLF will eventually run out of customers, a point you outlined very well. Though I did find it interesting that HLF keeps having a net positive in distributors/customers every year as you showed. Are they running out of countries to pull from? Possibly..."

"I have ready Ackman's presentation in it's entirety. It simply won't meet the legal definition.If this ever went to Court all that would happen would be the Court would say that distributors buying themselves MUST count as retail sales as the sales are bought directly from the company and are for retail product, not for getting other members. Once that happens, they will easily meet the 50.1% minimum sales necessary to not be considered a pyramid. There are different types of pyramid schemes, and not all of them are illegal. The type Ackman would need to prove simply won't be up to the legal standard. However, the argument that they are going to run out of customers is an entirely different and better argument against HLF on it's own."

This is a lawyer talking....

http://seekingalpha.com/article/1105911-herbalife-headscratchers
 
Ackman's ass is toast. He's about to get wiped out because I feel the "mother" (Saddam Hussein parlance) of all short squeezes coming down the pike. This will be epic to watch.
 
Quote from HurricaneUS:

Ackman's ass is toast. He's about to get wiped out because I feel the "mother" (Saddam Hussein parlance) of all short squeezes coming down the pike. This will be epic to watch.
More...

'This will be epic to watch."
if true this will be an epic to participate in.
 
Quote from HurricaneUS:

Ackman's ass is toast. He's about to get wiped out because I feel the "mother" (Saddam Hussein parlance) of all short squeezes coming down the pike. This will be epic to watch.
More...

Two things.
1. How do you know he hasn't already pocketed some serious cashola from this trade?
2. Dead cat bounce? Who knows?
 
I think it's all the traders who shorted after him who got squeezed. I bet his borrow is secure. Certainly he has the warewithal to handle $20MM/point as it's still below his cost basis.
 
It's popping today. Up 8.7%. Wonder if Ackman might be unloading some shares. By now, he probably has hedged.

Anyone shorting now has some real balls!
 
Quote from lwlee:

It's popping today. Up 8.7%. Wonder if Ackman might be unloading some shares. By now, he probably has hedged.

Anyone shorting now has some real balls!
More...

But has he even made a profit? Thats the question.

With the cost of hedge, borrow etc..
 
Technically speaking HLF can reach 46-47$ before a pullback. Bollinger and such on the daily chart....

From Seekingalpha:

"Since the stock pays a 3.2% dividend, Mr. Ackman will have to shell out $32 million a year to cover the dividend on his short stock. "
 
Ballsy move, surf. I think Ackman's average cost is around $50, tho I've read it could be higher like $60. Personally I think it's gonna go to $50 or higher. Stock have a way of testing shorts, especially massive ones like Ackman.

There are a number of catalysts that could generate a big squeeze.
- HLF doing a big share buyback.
- Ackman reducing his position as it gets closer to his break-even.
- more buyers piling in as they smell blood (Ackman's blood).
- HLF earnings are very good.

What does Ackman have on his side? SEC's investigation may take a long time.

Quote from marketsurfer:

doubled shorts at $43,o5 in herbaldeath, will average in once again if needed-- $20 is in the books for this one. surf
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