Herbalife had a big bounce at the end of the day with the stock surging in the final hour of trading to close up more than 7%.
Early this morning, the stock was up after Herbalife released two press releases relating to earnings and announcing a $US1 billion convertible bond note offering.
Then, shares of Herbalife fell about 3% after Bill Ackman’s hedge fund Pershing Square launched a new website this morning taking on the company’s distributors that they believe use predatory business practices.
You can see in the chart below the stock rally and volume spike in the final hour of trading.
Herbalife, a multi-level marketing company that sells weight loss shakes and supplements, has been at the crosshairs of an epic hedge fund battle.
Bill Ackman, who runs Pershing Square, is short the stock. He believes Herbalife operates as a “pyramid scheme” that hurts lower income individuals.
Other fund managers don’t buy his argument, most notably Carl Icahn, who has amassed a huge stake in the company.
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