Herbalife Beats on Both Top and Bottom Lines

Herbalife (NYSE: HLF  ) reported earnings on Feb. 19. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Herbalife beat slightly on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly. GAAP earnings per share increased significantly.

Margins contracted across the board.

Revenue details
Herbalife tallied revenue of $1.06 billion. The six analysts polled by S&P Capital IQ wanted to see revenue of $1.05 billion on the same basis. GAAP reported sales were 20% higher than the prior-year quarter's $884.6 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.05. The eight earnings estimates compiled by S&P Capital IQ forecast $1.01 per share. GAAP EPS of $1.05 for Q4 were 24% higher than the prior-year quarter's $0.85 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 46.5%, 100 basis points worse than the prior-year quarter. Operating margin was 15.1%, 10 basis points worse than the prior-year quarter. Net margin was 11.1%, 80 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.10 billion. On the bottom line, the average EPS estimate is $1.06.

Next year's average estimate for revenue is $4.59 billion. The average EPS estimate is $4.64.

Investor sentiment
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 437 members out of 655 rating the stock outperform, and 218 members rating it underperform. Among 196 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 109 give Herbalife a green thumbs-up, and 87 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Herbalife is outperform, with an average price target of $75.43.

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