Is It Time To Sell Herbalife?

Herbalife is a company which sells product that concerns on weight loss & other things that would help people to live a healthy life. Now, in few weak, several issues have come on the focus for Herbalife. First of all, to sell Herbalife the company has taken a multilevel business program. People, who are investing in this business, focus more on recruiting people then selling Herbalife. Also, it is getting very hard to sell the product itself to people. For which people who are investing in the business, are facing loss.

The company, is not bothered about the problem that there product is getting hard to sell to people; rather they are focusing & encouraging the investors to recruit more people. Actually, this is the main concern for all of the products & manufacturing companies who promote their products through multi level business program.

The advantage of such program is that no matter what happens to the ground level of investors & they may face with huge financial losses for failing to recruit people, people who are staying up in the level of the pyramids, are certainly on profit & they do not bother about whether the products are being sold or not or about the quality of the product.

The controversies over Herbalife products & its money making policy came into more highlights when bill acumen, the manager of hedge fund & activist has taken a challenge against the Herbalife Company. According to bellman, the Herbalife Company has only focused on the multilevel business programmed rather than on its product. It is nothing more than a pyramid scheme. Not only he stopped here, he also betted $1 billion publicly over the claim that the stocks of this company will soon comes at the point of zero.

Until now, this corporate showdown has been recorded as the highest showdown in the corporate level. If, Bill Ackman is right on what he has said, then, federal commission has to put an end over the Herbalife Company. The company is still on the rate of four billion dollar annual sales rate. The company also has a sales network of over 3.2 million people in 87 countries of all over the world.

If the company is going to have such consequences, then all these people are going face a huge loss & also the stock markets are going to face a huge crash for that. On the other hand, if that happens so, Bill acumen’s hedge fund is going to have a rush in profits. It can be sure that huge lines of billions are waiting to go the accounts of hedge, if Herbalife crashes at this point.

But, the fact can also be changed from another point of view. Oaf bill acumen is not right, and then the total scenario can be changed. First of all such a huge bet & failing on it will tarnish his creditability as an investor & activist. The profit scale of the company can also get an impact for that.

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Author Bio: FREE Million dollar trader interview – http://www.tradingandinvesting4u.com/
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Category: Finances
Keywords: Dow Jones, ASX, Herbalife, ECB, FTSE, Earnings