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  • Bill Ackman's Pershing Square says Herbalife (HLF +1.6%) "refuses" to release actual sales data, which violates a California injunction, and is requesting that regulators "promptly" initiate a probe of the company. Ackman says the release of the actual data collected by its distributors would "put to rest" whether it is or isn't a pyramid scheme. [View news story]
    For those who do not understand how Ackman operates or depend on a "Royalty" check from the Herbalife pyramid scheme, I recommend you read Confidence Game: How Hedge Fund Manager Bill Ackman Called Wall Street's Bluff by Christine S. Richard
    Jun 18 05:32 PM | Likes Like |Link to Comment
  • An Investor's Guide To Identifying Pyramid Schemes [View article]
    Join My Ponzy Scheme Now Ask Me How
    Jan 16 12:43 PM | Likes Like |Link to Comment
  • An Investor's Guide To Identifying Pyramid Schemes [View article]
    DISTRIBUTORS DO NOT GET PAID UNLESS THEY BUY $2,500.00 OF PRODUCTS EVERY SINGLE MONTH.
    Oct 13 03:07 PM | 1 Like Like |Link to Comment
  • An Investor's Guide To Identifying Pyramid Schemes [View article]
    HLF definitely is a Ponzi scheme with very high legal bills.
    A Ponzi scheme is a fraudulent investment operation that pays returns to its DISTRIBUTORS from their own "PURCHASE" of the "PRODUCTS" paid by subsequent DISTRIBUTORS, rather than from profit earned by the "SELL" of the "PRODUCTS". The Ponzi scheme usually entices new DISTRIBUTORS by offering higher profits, in the form of short-term returns that are either abnormally high or unusually consistent. DISTRIBUTORS DO NOT GET PAID UNLESS THEY BUY $2,500.00 OF PRODUCTS EVERY SINGLE MONTH. Perpetuation of the high returns requires an ever-increasing flow of money from new DISTRIBUTORS to keep the scheme going. At the top of the Ponzi scheme is Johnson with a $98 million LOOT in 2011 and more millions for his band of chihuahuas.
    Oct 13 02:58 PM | 1 Like Like |Link to Comment
  • Herbalife's Nutritional Club Sales Will Take Company To The Next Level [View article]
    Bank of America/Merrill Lynch will say anything positive about the company as they try to sell their inventory of stock to you(as you know they are the ones who did the initial offering and market makers for the stock). As they recently upgraded the stock, everybody on Wall Street knows what an upgrade means specially when it comes from the bank who makes the market for the stock, the only ones in the dark are the investing public.
    Check on ebay, amazon and craigslist and you will be amaze at how many distributors are trying to unload their inventory. (i guess the sales at the clubs are not enough for them to cover their monthly quota).
    On HLF Balance Sheet you have a total equity 560 million, the company as a business is selling for over 5 billion, you are a business owner and you would not dream about paying over 10 times for the assets of a business, even when those assets are producing only 412 million less than 10% on the equity.
    Now all you need is a bad quarter from HLF and you will see your hard earned investment money go down another 40% just like we already saw recently from 73 to 42.
    HLF lacks durable competitive advantage, people will choose Starbucks or better yet McDonalds to go and drink a milk shake rather than a "Herbalife Club" when was the last you went to Starbucks or McDonalds? and to a Herbaife Club? Have you even been to a Club? Distributors are having to add Zumba dancing classes and others gimmicks in order to try to make the people drink the shakes. Do you even drink the shakes?
    The first principle of investment is that you must not fool yourself and you are the easiest person to fool.
    On the stock options granted to Johnson "The typical large company has a compensation committee and they don't look for Dobermans on that committee, they look for chihuahuas"
    Typically, executives have argued that options are hard to
    value and that therefore their costs should be ignored. At other
    times managers have said that assigning a cost to options would
    injure small start-up businesses. Sometimes they have even solemnly declared that "out-of-the-money" options (those with an exercise price equal to or above the current market price) have no
    value when they are issued.
    Oddly, the Council of Institutional Investors has chimed in
    with a variation on that theme, opining that options should not be
    viewed as a cost because they "aren't dollars out of a company's
    coffers." I see this line of reasoning as offering exciting possibilities
    to American corporations for instantly improving their reported
    profits. For example, they could eliminate the cost of insurance by
    paying for it with options. So if you're a CEO and subscribe to this
    "no cash-no cost" theory of accounting, I'll make you an offer you
    can't refuse: Give us a call and we will happily sell you
    insurance in exchange for a bundle of long-term options on your
    company's stock.
    Shareholders should understand that companies incur costs
    when they deliver something of value to another party and not just
    when cash changes hands. Moreover, it is both silly and cynical to
    say that an important item of cost should not be recognized simply
    because it can't be quantified with pinpoint precision.
    Does this mean that these important items of cost should be
    ignored simply because they can't be quantified with absolute accuracy? Of course not.
    It seems to me that the realities of stock options can be summarized quite simply: If options aren't a form of compensation,
    what are they? If compensation isn't an expense, what is it? And, if
    expenses shouldn't go into the calculation of earnings, where in the
    world should they go?
    Oct 11 06:19 PM | Likes Like |Link to Comment
  • Herbalife's Nutritional Club Sales Will Take Company To The Next Level [View article]
    For someone who has made an in-depth
    study of the possibilities of this company and come up with exceptionally firm and optimistic conclusions. But not for the careful
    investor who wants to be reasonably sure in advance that he is not
    committing the typical Wall Street error of over enthusiasm for
    good performance in earnings and in the stock market, you have a company that is trading at almost 22 times book value. High valuations entail high risks. What is important to know is what will happen, difficult to know when will happen. A cautionary statement in the case of HLF with a special reference to the market’s current valuation of over five billion dollars for the intangible, or earning-power factor. HLF.is an outstanding company, but it will have to continue to be such an exception for a great many years in the future before the 73 closing price will have been fully justified by its subsequent performance. (the security already went from 73 to 42 in less than 1 week).
    Be suspicious of companies that trumpet earnings projections and growth expectations. Businesses seldom operate in a tranquil, no-surprise environment, and earnings simply don't advance smoothly (except in the offering books of investment bankers). We're suspicious of those CEOs who claim to know the future - and we become downright incredulous if they consistently reach their declared targets. Managers that always promise to "make the numbers" will at some point. HLF.is an outstanding company not because of the management but because of its distributors.
    Paying $98 million to a CEO in 1 year only benefits the CEO, his family and friends, that at the same time are getting paid excessive amounts of millions.
    The only ones losing here are the distributors like you who try to defend the company and get paid pennies on the dollar.
    The HLF CEO is not buying any more shares with his $98 million + he is out and the ones holding the bag are once again the distributors who keep defending the company and CEO and getting paid coins.
    Strive for objectivity. Scientists try to describe the world as it is, not as they want it to be.
    Oct 11 10:55 AM | Likes Like |Link to Comment
  • Herbalife's Nutritional Club Sales Will Take Company To The Next Level [View article]
    Herbalife's Nutritional Clubs are barely covering the expenses to pay for rent, utilities and all the other expenses associated with running a club. The product is very overpriced and that's what gave way to the nutrition clubs, distributors having to break down the products in servings to to be able to sale it because the customers refuse to buy whole canisters and bottles. What is happening now is customers stopped buying canisters and bottles and distributors are barely covering their monthly quota just to support the pyramid without making any money. Of course the distributors at the top make all the money and are the same ones you see one the stage year after year (Petersons,Geri Citanovich, Alan Lorenz, Leslie Standford, John Tartol, etc..) . The revenue numbers you showed represent 2 things, first over 30% increase in prices to distributors of course and size of canisters 25% bigger sizes and second the opening of 40+ countries. Trees do not grow to the sky and eventually those distributors who have 3, 5 year leases on their stores will start to close shop and the "leaders" will have to come up with a new scheme. By the way Johnson already took his $98 million and he is not reinvesting it back into the company. There have been before different failed schemes with Herbalife just to name a few (5x5, work from home, the gold diet, green and beige, cellular nutrition, the HAP program, etc..) each one of this programs had promised to take HLF to the "next level" and after failing they had to delist the company, make a new offering and in this case, make the headquarters on a tropical island Ugland House South Church Street Grand Cayman, Cayman Islands.
    Oct 10 06:13 PM | Likes Like |Link to Comment
  • Herbalife, Nutrition Clubs, And End Consumers: A Look At The Company's Rules [View article]
    Be suspicious of companies that trumpet earnings projections and growth expectations. Businesses seldom operate in a tranquil, no-surprise environment, and earnings simply don't advance smoothly (except in the offering books of investment bankers). We're suspicious of those CEOs who claim to know the future - and we become downright incredulous if they consistently reach their declared targets. Managers that always promise to "make the numbers" will at some point. HLF.is an outstanding company not because of the management but because of its distributors.
    Paying $98 million to a CEO in 1 year only benefits the CEO, his family and friends, that at the same time are getting paid excessive amounts of millions.
    The only ones losing here are the distributors like you who try to defend the company and get paid pennies on the dollar.
    The HLF CEO is not buying any more shares with his $98 million + he is out and the ones holding the bag are once again the distributors who keep defending the company and CEO and getting paid coins.
    Strive for objectivity. Scientists try to describe the world as it is, not as they want it to be.
    Aug 8 05:49 PM | Likes Like |Link to Comment
  • Herbalife, Nutrition Clubs, And End Consumers: A Look At The Company's Rules [View article]
    barmen maybe for someone who has made an in-depth
    study of the possibilities of this company and come up with exceptionally firm and optimistic conclusions. But not for the careful
    investor who wants to be reasonably sure in advance that he is not
    committing the typical Wall Street error of overenthusiasm for
    good performance in earnings and in the stock market, you have a company that is trading at almost 22 times book value. High valuations entail high risks. What is important to know is what will happen, difficult to know when will happen. A cautionary statement in the case of HLF with a special reference to the market’s current valuation of over five billion dollars for the intangible, or earning-power factor. HLF.is an outstanding company, but it will have to continue to be such an exception for a great many years in the future before the 73 closing price will have been fully justified by its subsequent performance. (the security already went from 73 to 42 in less than 1 week).
    Aug 8 01:22 PM | Likes Like |Link to Comment
  • Herbalife, Nutrition Clubs, And End Consumers: A Look At The Company's Rules [View article]
    Clearly the author did his homework on HLF, it is not a matter of IF but WHEN HLF's price will fall. Paying $98 million in 1 year to a CEO measure by the size of the company makes it a very unattractive security and tells you a lot about what is really going on at the management level. The 25% growth can not be maintain forever (either by organic growth or accounting trickery) and eventually it will shrink to a lower digit.
    HLF's price will fall, I just do not know when.
    Investors in this security should proceed with caution and not get carried over by their own euphoria.
    Trees do not grow to the sky.
    Aug 7 05:27 PM | Likes Like |Link to Comment
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