Herbalife To Get A Boost From David Beckham

David Beckham’s arrival in Los Angeles to play for the Galaxy Major League Soccer team means a lot to a lot of people. It signifies a possible breakthrough in making the sport popular in North America. It also marks the arrival on the Hollywood scene of him and his wife Victoria (a.k.a. Posh Spice).

For Galaxy sponsor Herbalife Ltd. (HLF), it means much more exposure, including a Sports Illustrated cover shot:

The marketer of weight management and nutritional supplements got a positive reaction from its distributors as a result of the publicity, Canaccord Adams analyst Scott Van Winkle said in a note to clients. Herbalife recently hosted 13,000 distributors at the launch of its new H30 fitness drink and a line of multivitamins for kids.

Mr. Van Winkle thinks the company will post strong second quarter results in early August.

“We continue to expect accelerating growth in the U.S., driven by nutrition clubs, and we expect the acceleration to continue as the Beckham-effect impacts Q3 and beyond,” he said.

Mr. Van Winkle rates Herbalife shares a “buy” with a US$52 price target, representing upside of roughly 20%.

HLF 1-yr chart: