FMP
Feb 23, 2025(Last modified: Feb 24, 2025)
Herbalife Nutrition Ltd. (NYSE:HLF) is a global nutrition company that develops and sells dietary supplements, weight management, sports nutrition, and personal-care products. The company operates through a network of independent distributors and is known for its direct-selling model. Herbalife competes with companies like Nu Skin Enterprises, Inc. (NUS) and USANA Health Sciences, Inc. (USNA) in the health and wellness industry.
Herbalife's Return on Invested Capital (ROIC) is 33.60%, while its Weighted Average Cost of Capital (WACC) is 19.71%. This results in a ROIC to WACC ratio of 1.71, indicating that Herbalife is generating returns well above its cost of capital. This suggests efficient capital utilization, which is crucial for long-term growth and profitability.
In comparison, Nu Skin Enterprises has a ROIC of 0.34% and a WACC of 6.69%, resulting in a ROIC to WACC ratio of 0.05. This indicates that Nu Skin is not generating sufficient returns relative to its cost of capital, which could impact its financial health and growth prospects.
Yelp Inc. shows a ROIC of 13.01% and a WACC of 10.56%, leading to a ROIC to WACC ratio of 1.23. While Yelp's ratio is positive, it is lower than Herbalife's, suggesting that Herbalife is more effective in generating returns on its invested capital compared to Yelp.
Deckers Outdoor Corporation stands out with a ROIC to WACC ratio of 3.28, the highest among the peers. With a ROIC of 30.38% and a WACC of 9.26%, Deckers is highly efficient in generating returns relative to its cost of capital, surpassing both Herbalife and other peers in this analysis.
MicroStrategy Incorporated (NASDAQ:MSTR) is a prominent business intelligence company known for its software solutions a...
Introduction In corporate finance, assessing how effectively a company utilizes its capital is crucial. Two key metri...
Bank of America analysts reiterated a bullish outlook on data center and artificial intelligence capital expenditures fo...