Anyone following Herbalife Ltd. (HLF), Nu Skin Enterprises Inc. (NUS) and USANA Health Sciences Inc. (USNA) , know that the debate over the practices of multi-level marketing (“MLM”), particularly with U.S. companies operating in China, has been a hot topic. That is why investors will want to know what we have found out about Natural Health Trends Corp. (NHTC).
After being long NHTC for nearly one year, we are now short NHTC. Our preliminary due diligence is not positive. We are still progressing with our diligence, but because NHTC fell 35% in the September 8, 2014 trading session, we thought it would prudent to alert investors to our belief that a greater implosion in shares of NHTC is in the works.
Natural Health Trends Corp. (NHTC) – network marketing
NHTC describes itself as an international direct-selling organization that sells personal care, wellness, and quality of life” products. More specifically saying,“we are engaged in what is called network marketing or multi-level marketing.” It also mentions how important China is to its business:
“China has been and continues to be our most important business development project.”
We will be releasing the following tweets:
According to Chinese website, NHTC operates an illegal E-commerce MLM platform
NHTC price action is similar to May 2004 one-day plunge of 43.9% on heels of a negative report from Hong Kong media source. Shares went on to eventually hit $0.20.