HERBALIFE LTD (HLF) Stock Fundamental Analysis
NYSE:HLF - New York Stock Exchange, Inc. - KYG4412G1010 - Common Stock - Currency: USD
HLF gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 35 industry peers in the Personal Care Products industry. While HLF has a great profitability rating, there are quite some concerns on its financial health. HLF scores decently on growth, while it is valued quite cheap. This could make an interesting combination.
1. Profitability
1.1 Basic Checks
In the past year HLF was profitable.
HLF had a positive operating cash flow in the past year.
Each year in the past 5 years HLF has been profitable.
HLF had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HLF has a Return On Assets of 10.45%. This is in the better half of the industry: HLF outperforms 77.14% of its industry peers.
The Return On Invested Capital of HLF (25.78%) is better than 94.29% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HLF is significantly above the industry average of 15.14%.
The 3 year average ROIC (21.47%) for HLF is below the current ROIC(25.78%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.45% | ||
| ROE | N/A | ||
| ROIC | 25.78% |
ROA(3y)8.71%
ROA(5y)10.82%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)21.47%
ROIC(5y)23.4%
1.3 Margins
The Profit Margin of HLF (5.66%) is better than 71.43% of its industry peers.
In the last couple of years the Profit Margin of HLF has declined.
HLF has a Operating Margin of 11.56%. This is in the better half of the industry: HLF outperforms 68.57% of its industry peers.
In the last couple of years the Operating Margin of HLF has declined.
HLF's Gross Margin of 78.09% is amongst the best of the industry. HLF outperforms 94.29% of its industry peers.
In the last couple of years the Gross Margin of HLF has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.56% | ||
| PM (TTM) | 5.66% | ||
| GM | 78.09% |
OM growth 3Y-9.16%
OM growth 5Y-4.06%
PM growth 3Y-12.9%
PM growth 5Y-4.4%
GM growth 3Y-0.32%
GM growth 5Y-0.62%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so HLF is creating value.
Compared to 1 year ago, HLF has more shares outstanding
Compared to 5 years ago, HLF has less shares outstanding
The debt/assets ratio for HLF has been reduced compared to a year ago.
2.2 Solvency
HLF has an Altman-Z score of 2.29. This is not the best score and indicates that HLF is in the grey zone with still only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.29, HLF perfoms like the industry average, outperforming 45.71% of the companies in the same industry.
HLF has a debt to FCF ratio of 13.34. This is a negative value and a sign of low solvency as HLF would need 13.34 years to pay back of all of its debts.
HLF has a Debt to FCF ratio (13.34) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 13.34 | ||
| Altman-Z | 2.29 |
ROIC/WACC3.07
WACC8.41%
2.3 Liquidity
HLF has a Current Ratio of 0.97. This is a bad value and indicates that HLF is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.97, HLF is doing worse than 74.29% of the companies in the same industry.
A Quick Ratio of 0.54 indicates that HLF may have some problems paying its short term obligations.
HLF has a Quick ratio of 0.54. This is amonst the worse of the industry: HLF underperforms 82.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.54 |
3. Growth
3.1 Past
HLF shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -4.63%.
The Earnings Per Share has been decreasing by -7.08% on average over the past years.
The Revenue has decreased by -2.45% in the past year.
Measured over the past years, HLF shows a small growth in Revenue. The Revenue has been growing by 0.47% on average per year.
EPS 1Y (TTM)-4.63%
EPS 3Y-25.39%
EPS 5Y-7.08%
EPS Q2Q%20.41%
Revenue 1Y (TTM)-2.45%
Revenue growth 3Y-4.89%
Revenue growth 5Y0.47%
Sales Q2Q%-3.37%
3.2 Future
Based on estimates for the next years, HLF will show a very strong growth in Earnings Per Share. The EPS will grow by 21.52% on average per year.
The Revenue is expected to grow by 3.38% on average over the next years.
EPS Next Y8.68%
EPS Next 2Y15.81%
EPS Next 3Y21.52%
EPS Next 5YN/A
Revenue Next Year-0.64%
Revenue Next 2Y1.71%
Revenue Next 3Y3.38%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
HLF is valuated cheaply with a Price/Earnings ratio of 4.24.
Based on the Price/Earnings ratio, HLF is valued cheaply inside the industry as 100.00% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 26.92. HLF is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 3.32, which indicates a rather cheap valuation of HLF.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HLF indicates a rather cheap valuation: HLF is cheaper than 100.00% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of HLF to the average of the S&P500 Index (21.49), we can say HLF is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.24 | ||
| Fwd PE | 3.32 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HLF is valued cheaper than 94.29% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, HLF is valued cheaply inside the industry as 100.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.41 | ||
| EV/EBITDA | 3.9 |
4.3 Compensation for Growth
HLF's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
HLF has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as HLF's earnings are expected to grow with 21.52% in the coming years.
PEG (NY)0.49
PEG (5Y)N/A
EPS Next 2Y15.81%
EPS Next 3Y21.52%
5. Dividend
5.1 Amount
HLF does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
8.73
+0.39 (+4.68%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryPersonal Care Products
Earnings (Last)
Earnings (Next)
Inst Owners104.87%
Inst Owner Change6.44%
Ins Owners2.11%
Ins Owner Change0.33%
Market Cap889.15M
Analysts50.91
Price Target8.16 (-6.53%)
Short Float %13.68%
Short Ratio6.87
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)60.72%
Min EPS beat(2)59.17%
Max EPS beat(2)62.26%
EPS beat(4)4
Avg EPS beat(4)54.51%
Min EPS beat(4)35.7%
Max EPS beat(4)62.26%
EPS beat(8)6
Avg EPS beat(8)28.26%
EPS beat(12)9
Avg EPS beat(12)27.7%
EPS beat(16)12
Avg EPS beat(16)22.44%
Revenue beat(2)1
Avg Revenue beat(2)-0.56%
Min Revenue beat(2)-1.24%
Max Revenue beat(2)0.12%
Revenue beat(4)1
Avg Revenue beat(4)-1.69%
Min Revenue beat(4)-4.54%
Max Revenue beat(4)0.12%
Revenue beat(8)4
Avg Revenue beat(8)-0.41%
Revenue beat(12)7
Avg Revenue beat(12)0.8%
Revenue beat(16)7
Avg Revenue beat(16)-0.18%
PT rev (1m)0%
PT rev (3m)-7.25%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-18.52%
EPS NY rev (1m)0%
EPS NY rev (3m)2.18%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.24 | ||
| Fwd PE | 3.32 | ||
| P/S | 0.18 | ||
| P/FCF | 5.41 | ||
| P/OCF | 3.27 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 3.9 |
EPS(TTM)2.06
EY23.6%
EPS(NY)2.63
Fwd EY30.11%
FCF(TTM)1.61
FCFY18.49%
OCF(TTM)2.67
OCFY30.57%
SpS48.61
BVpS-7.23
TBVpS-11.16
PEG (NY)0.49
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.45% | ||
| ROE | N/A | ||
| ROCE | 36.81% | ||
| ROIC | 25.78% | ||
| ROICexc | 32.71% | ||
| ROICexgc | 48.62% | ||
| OM | 11.56% | ||
| PM (TTM) | 5.66% | ||
| GM | 78.09% | ||
| FCFM | 3.32% |
ROA(3y)8.71%
ROA(5y)10.82%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)21.47%
ROIC(5y)23.4%
ROICexc(3y)31.31%
ROICexc(5y)37.76%
ROICexgc(3y)50.31%
ROICexgc(5y)62.7%
ROCE(3y)30.65%
ROCE(5y)33.4%
ROICexcg growth 3Y-11.83%
ROICexcg growth 5Y-10.42%
ROICexc growth 3Y-12.15%
ROICexc growth 5Y-7.63%
OM growth 3Y-9.16%
OM growth 5Y-4.06%
PM growth 3Y-12.9%
PM growth 5Y-4.4%
GM growth 3Y-0.32%
GM growth 5Y-0.62%
F-Score6
Asset Turnover1.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 13.34 | ||
| Debt/EBITDA | 2.84 | ||
| Cap/Depr | 87.39% | ||
| Cap/Sales | 2.17% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 39.09% | ||
| Profit Quality | 58.63% | ||
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.54 | ||
| Altman-Z | 2.29 |
F-Score6
WACC8.41%
ROIC/WACC3.07
Cap/Depr(3y)118.39%
Cap/Depr(5y)121.51%
Cap/Sales(3y)2.71%
Cap/Sales(5y)2.55%
Profit Quality(3y)93.92%
Profit Quality(5y)97.9%
High Growth Momentum
Growth
EPS 1Y (TTM)-4.63%
EPS 3Y-25.39%
EPS 5Y-7.08%
EPS Q2Q%20.41%
EPS Next Y8.68%
EPS Next 2Y15.81%
EPS Next 3Y21.52%
EPS Next 5YN/A
Revenue 1Y (TTM)-2.45%
Revenue growth 3Y-4.89%
Revenue growth 5Y0.47%
Sales Q2Q%-3.37%
Revenue Next Year-0.64%
Revenue Next 2Y1.71%
Revenue Next 3Y3.38%
Revenue Next 5YN/A
EBIT growth 1Y40.56%
EBIT growth 3Y-13.6%
EBIT growth 5Y-3.61%
EBIT Next Year36.18%
EBIT Next 3Y18.41%
EBIT Next 5YN/A
FCF growth 1Y33.88%
FCF growth 3Y-19.13%
FCF growth 5Y-14.2%
OCF growth 1Y1.34%
OCF growth 3Y-14.73%
OCF growth 5Y-9.01%