Liabilities Breakdown
1.1 B
Current Liabilities
2.7 B
Long-Term Liabilities
| Total Liabilities | 3.83 Billion | |
| Current Liabilities | 1.09 Billion | |
| Long-Term Liabilities | 2.74 Billion | |
| Tax Liabilities | 63.22 Million |
How much will Herbalife Nutrition owe in October?
 | By Gabriel Shpitalnik | Macroaxis Story |
Herbalife Nutrition, a prominent player in the Personal Care Products industry, has shown some intriguing financial dynamics as we head into October. Despite a significant Retained Earnings loss of 1.2B, the company's Total Revenue stands strong at 5.2B, outpacing the Cost Of Revenue of 1.2B. The company's End Period Cash Flow is also robust at 516.3M, supporting a healthy Free Cash Flow of 196.1M. However, the company's financial health is somewhat marred by a hefty Non Current Liabilities Total of 3B and a Net Tangible Assets deficit of 1.7B. Analysts' estimates for the stock price range from 12 to 33, with an average of 5 estimates. Despite these challenges, the company's solid revenue and cash flow figures suggest there may be untapped potential in Herbalife Nutrition stock this October. The end of the next fiscal quarter for Herbalife Nutrition is anticipated to be on September 30, 2023. It is projected that Herbalife Nutrition's Earnings Before Tax (EBT) will likely experience a significant decrease in the forthcoming years. The EBT value reported last year was at $424.8 million. The current Enterprise Value is expected to rise to approximately $5.8 billion, while the Invested Capital is forecasted to decrease to roughly $3.3 billion. As many millennials are steering clear of the personal care products sector, it would be prudent to focus more on Herbalife Nutrition and try to comprehend its current market trends.
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Reviewed by Vlad Skutelnik
Herbalife Nutrition carries a substantial debt of $2.88 billion, with a debt-to-equity (D/E) ratio of 7.3. This suggests that Herbalife Nutrition might struggle to generate sufficient cash to meet all its financial obligations. The company's current ratio stands at 1.37, which is typical for the industry and is considered normal. While debt can support Herbalife Nutrition's operations, difficulties may arise if the company is unable to pay it off, either through new capital or free cash flow. In such a scenario, Herbalife Nutrition's shareholders could potentially lose their entire investment if the company fails to meet its legal debt repayment obligations.
However, a more common scenario is for companies like Herbalife Nutrition to issue additional shares at discounted prices, thereby diluting the value of existing shares. In this context, debt can be an effective tool for Herbalife Nutrition to invest in high-return growth opportunities. When evaluating Herbalife Nutrition's use of debt, it is crucial to consider it in conjunction with the company's cash and equity positions.
Additional examination
Herbalife Nutrition (HRL), a leading player in the Packaged Foods industry, presents an intriguing investment opportunity this October. The company's robust financial health, demonstrated by its substantial Selling, General & Administrative (SG&A) budget of $1.8 billion, indicates a strong capacity to invest in growth and innovation. Furthermore, the company's low Mean Deviation of 2.45 and Standard Deviation of 3.37 suggest that HRL's stock price is less volatile compared to the market, making it a potentially safer bet for investors looking for steady returns. The company's financial leverage, however, is a point of concern. Herbalife's Interest Expense stands at $133.2 million, which, when compared to its Interest Income of only $6.1 million, indicates a significant financial burden. Despite this, the company has managed to maintain a healthy Income Before Tax of $424.8 million, demonstrating its ability to generate substantial profits despite its high leverage. In conclusion, Herbalife Nutrition's stock may hold untapped potential for investors this October. Despite its high leverage, the company's strong financial health and low price volatility make it an attractive investment. However, investors should also consider the company's high interest expense and the associated risks before making a decision. Herbalife Nutrition financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Herbalife Nutrition, including all of Herbalife Nutrition's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Herbalife Nutrition assets, the company is considered highly leveraged. Understanding the composition and structure of overall Herbalife Nutrition debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it. Please read more on our technical analysis page.How important is Herbalife Nutrition's Liquidity
Herbalife Nutrition financial leverage refers to using borrowed capital as a funding source to finance Herbalife Nutrition ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Herbalife Nutrition financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Herbalife Nutrition's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Herbalife Nutrition's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Herbalife Nutrition's total debt and its cash.
An Additional Perspective On Herbalife Nutrition
The current bullish price patterns experienced by current Herbalife Nutrition shareholders may raise some interest from stockholders. The stock closed today at a share price of 14.49 on 830,417 in trading volume. The company directors and management have been very successful in rebalancing the firm assets at opportune times to take advantage of market volatility in August. The stock standard deviation of daily returns for 90 days investing horizon is currently 3.46. The above-average risk is mostly attributed to market volatility and speculations regarding some of the upcoming earning calls from Herbalife Nutrition partners.
Herbalife Nutrition, a key player in the Packaged Foods industry, is showing promising signs of untapped potential this October. Despite a Probability Of Bankruptcy at 33.11%, the company's strong financials suggest a solid foundation. With a robust EBITDA of $673.4M and Net Income of $321.3M, Herbalife is demonstrating its ability to generate substantial profits.The company's Current Ratio stands at 1.40X, indicating a healthy balance between its short-term assets and liabilities. Moreover, Herbalife has a significant Market Capitalization of $1.44B, reflecting its substantial size and stability in the market. The company's Price to Earnings ratio is at a low 5.48X, suggesting that the stock could be undervalued. Additionally, the company's shares are predominantly owned by institutions, with a staggering 97.53% of shares held by them, indicating strong market confidence. However, investors should also consider the company's high Total Debt of $2.88B and negative Retained Earnings Total Equity of $1.2B. Despite these challenges, Herbalife's strong cash flow from operations at $352.5M and End Period Cash Flow of $516.3M provide some financial cushion. Given these factors, Herbalife Nutrition stock could offer untapped potential for investors this October. .
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