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...Continue reading this article »