I don't really know what to tell you about Herbalife's investor day presentation this morning. One thing that's definitely true is that it was shorter than Bill Ackman's anti-Herbalife presentation a few weeks ago, which the Herbalife team seemed inordinately proud of, since, like, the Ring Cycle is shorter than Ackman's presentation. It was ... guys, honestly, it was creepy, the word is creepy. Here is where Herbalife's president, Des Walsh, made me particularly uncomfortable:
“It’s about a shake, a tea, an Aloe — and a hug. I know in this community, hugging is not something you do a lot. But the world needs more hugs. And they find them, along with good nutrition, in the nutrition clubs.”
That's from DealBook's live blog, which collects the highlights. (DealBook also has a good breakdown of the legal issues involved in "is Herbalife a scam?") Ackman has already responded, arguing that Herbalife distorted his arguments and failed to address a lot of his points. This is true, though Herbalife definitely scored some "Ackman-is-distorting-our-business" points too; the whole thing seems likely to become a drawn-out contest of two sides talking past each other, at maximum length.1
You can understand why that would happen. Many of Herbalife's arguments were prefaced with "now I know this may not seem cool to you Wall Street types, but ...," and ... and, no, it did not! Everyone told corny stories of people being inspired by weight-loss shakes, and the call ended with CEO Michael Johnson comparing Herbalife to the Girl Scouts. Wall Street, of course, prefers somewhat more concrete metrics: give me some cash flow numbers on those Girl Scouts, Michael!
And those, to be fair, may be forthcoming. Analysts asked for news on last quarter's earnings, share buybacks, and even a going-private, and while there was no concrete news, Herbalife seemed to at least affirm on earnings. Other concrete steps were also left mostly unspoken: Herbalife refused to say whether it plans to sue the crap out of Ackman, though rumors of the latter persist. Stories like that tend to be a bit more inspirational to investors.
Herbalife Investor Day Presentation [Herbalife]
Herbalife Responds to Accusations From Hedge Fund [DealBook]
What’s at the Center of the Debate Over Herbalife [DealBook]
Ackman Responds: Herbalife ‘Distorted, Mischaracterized’ Our Presentation [MarketBeat]
1.And thus maximum legal bills.