Lifevantage (NASDAQ:LFVN) versus Herbalife (NYSE:HLF) Critical Survey

Herbalife (NYSE:HLF) and Lifevantage (NASDAQ:LFVN) are both small-cap consumer staples companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Insider & Institutional Ownership

35.3% of Lifevantage shares are owned by institutional investors. 5.1% of Herbalife shares are owned by insiders. Comparatively, 22.0% of Lifevantage shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for Herbalife and Lifevantage, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Herbalife	0	4	3	0	2.43
Lifevantage	0	2	0	0	2.00

Herbalife currently has a consensus price target of $17.00, suggesting a potential upside of 37.51%. Lifevantage has a consensus price target of $5.00, suggesting a potential downside of 23.90%. Given Herbalife’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Herbalife is more favorable than Lifevantage.

Profitability

This table compares Herbalife and Lifevantage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Herbalife	3.16%	-43.90%	7.89%
Lifevantage	2.94%	23.89%	12.47%

Dividends

Herbalife pays an annual dividend of $1.20 per share and has a dividend yield of 9.7%. Lifevantage pays an annual dividend of $0.20 per share and has a dividend yield of 3.0%. Herbalife pays out 77.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lifevantage pays out 44.4% of its earnings in the form of a dividend. Lifevantage has raised its dividend for 3 consecutive years.

Earnings & Valuation

This table compares Herbalife and Lifevantage”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Herbalife	$5.20 billion	0.25	$228.30 million	$1.55	7.98
Lifevantage	$228.53 million	0.36	$9.81 million	$0.45	14.60

Herbalife has higher revenue and earnings than Lifevantage. Herbalife is trading at a lower price-to-earnings ratio than Lifevantage, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Herbalife has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Lifevantage has a beta of 0.72, suggesting that its share price is 28% less volatile than the S&P 500.

Summary

Herbalife beats Lifevantage on 9 of the 17 factors compared between the two stocks.

About Herbalife

Herbalife Ltd. provides health and wellness products in North America, Mexico, South and Central America, Europe, the Middle East, Africa, China, and the Asia Pacific. It offers products in the areas of weight management; targeted nutrition; energy, sports, and fitness; outer nutrition; and literature and promotional items. The company also provides weight management products, including meal replacement products, protein shakes, drink mixes, weight loss supplements, healthy snacks, and metabolism boosting teas; targeted nutrition products, which comprise functional beverages, and dietary and nutritional supplements that contain herbs, vitamins, minerals, and other natural ingredients; outer nutrition products, such as facial skin, body, and hair care products; and energy, sports, and fitness products, including N-R-G tea and energy drink products. In addition, it offers literature, promotional, and other materials that comprise start-up kits, sales tools, and educational materials. The company sells its products through sales representatives, independent service providers, and company-operated retail platforms. Herbalife Ltd. was formerly known as Herbalife Nutrition Ltd. and changed its name to Herbalife Ltd. in April 2023. The company was founded in 1980 and is headquartered in Los Angeles, California.

About Lifevantage

LifeVantage Corporation engages in the identification, research, development, formulation, and sale of advanced nutrigenomic activators, dietary supplements, nootropics, pre- and pro-biotics, weight management, skin and hair care, bath and body, and targeted relief products. It offers Protandim, a dietary supplement; LifeVantage Omega+, a dietary supplement that combines DHA and EPA Omega-3 fatty acids, Omega-7 fatty acids, and vitamin D3; LifeVantage ProBio, a dietary supplement to support gut health; PhysIQ, a weight management system; LifeVantage IC Bright, a supplement to support eye and brain health, reduce eye fatigue and strain, supports cognitive functions, and support normal sleep patterns; Petandim for Dogs, a supplement to combat oxidative stress in dogs; and Axio, a nootropic energy drink mix. The company also provides anti-aging skin care products, including liquid collagen, facial cleansers, perfecting lotions, eye serums, anti-aging creams, hand creams, beauty serum, as well as hair care products, such as invigorating shampoos, nourishing conditioners, and scalp serums under the LifeVantage TrueScience brand name. In addition, it offers bath and body, and targeted relief products, such as body lotion, body wash, body butter, deodorant, soothing balm, and body rub under the TrueScience brand name. It sells its products through its website and network of independent distributors in the United States, Mexico, Japan, Australia, Hong Kong, Canada, Thailand, the United Kingdom, the Netherlands, Germany, Taiwan, Austria, Spain, Ireland, Belgium, New Zealand, Singapore, and the Philippines. The company was founded in 2003 and is headquartered in Lehi, Utah.