DA Davidson Maintains Buy on Herbalife

DA Davidson has published a research report on Herbalife HLF after the company reported an EPS beat up 27.1% over 1Q2011. In the report, DA Davidson writes, "2012 EPS guidance was raised to $3.58-$3.74, previously $3.40-$3.60 on sales growth of 12.5%-14.5% and 12%-14% volume growth. This is conservative since HLF has grown volume in excess of 21% for three of the past four quarters. F/X is now expected to be a negative $0.25 impact to full year EPS, we previously expected $0.30, and the tax rate should be 26.5%-28.5%. Q2 EPS is guided to $0.91-$0.95 on sales growth of 9.5%-11.5% and volume growth of 11.5%-13.5%. Our 2012 EPS estimate goes to $3.75, previously $3.65, and we are boosting our 2013 view to $4.30, previously $4.20. We reiterate our $90 target and think HLF deserves the 24x multiple of our 2012 EPS estimate." DA Davidson maintains its Buy rating and $90 price target on Herbalife, which is currently trading down $14.32 from yesterday's $70.32 closing price.