Herbalife Ltd. shares were up more than 5% Monday and had passed the price they were when hedge fund manager Bill Ackman accused the Los Angeles nutritional products company of operating a long-running pyramid scheme.
The company’s stock price plummeted Dec. 19 after Ackman publicly disclosed that he had taken a $1-billion short against its shares. Within four trading days of Ackman’s announcement, the stock fell 43%, reaching $24.24 on Christmas Eve.
The downswing created a buying opportunity for billionaire investor Carl Icahn, who now owns nearly 16% of the company’s shares. The company also allowed him to add two members to its board of directors.
Herbalife’s stock has gained more than 20% in less than three weeks. The company recently announced record earnings for the first quarter and raised its guidance for the year.