Herbalife Shares Popped: What You Need to Know


Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of weight-loss expert Herbalife (NYS: HLF) fattened up today, packing on as much as 14% in intraday trading on heavier-than-average volume.

So what: It's easy to see why Herbalife shareholders are excited today. For the second quarter, the company reported total sales of $880 million, up 28% from last year and easily ahead of the $829 million that Wall Street was expecting. On the bottom line, Herbalife showed investors $0.88 in per-share earnings against the $0.75 analysts were expecting. Growth in North America was restrained, but strong performance in Asia Pacific, Mexico, and South and Central America drove the eye-catching results.

Now what: The hoopla wasn't just about Herbalife's past quarter, though. Business has been looking good enough that management raised expectations for the full year. The company now sees 2011 earnings per share between $2.97 and $3.07. That vaults the average estimate of $2.91 from Wall Street analysts.

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