Dan Loeb Buys Herbalife, Morgan Stanley & Tesoro: Third Point Q4 Letter

From market folly
January 9, 2013 - 2:43pm

Let the battle begin.  Dan Loeb's hedge fund Third Point has started a long position in Herbalife (HLF), he revealed in his Q4 letter to investors.  He also filed a 13G with the SEC disclosing that Third Point owns 8.24% of the company as of January 3rd. Loeb Long Herbalife Readers will recall that we recently posted up Bill Ackman's short presentation on HLF where he called it a pyramid scheme.  Brian Sullivan tweeted that Andrew Ross Sorkin spoke with Third Point, who believe there's no evidence HLF is a pyramid scheme in their research. Third Point believes in the compounder thesis that the stock was trading at an attractive discount (after Ackman's short presentation).  Third Point writes, "Applying a modest 10-12x earnings multiple suggests Herbalife's shares are worth $55-68, offering 40-70% upside from here and making the company a compelling long investmen...

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