Herbalife Ltd. (NYSE:HLF) released its earnings report for the first three months of 2013 this afternoon, Monday April 29, after the market closed. The company revealed earnings of $1.27 in the first quarter of the year on revenues of $1.12 billion. On today’s market, the company’s shares trended up a fraction finishing at $38.75.

Herbalife logo

In the run up to the release of the earnings report, analysts were looking for earnings of $1.06 from the multi-level marketing company, on revenues of $1.1 billion. In the same three months of 2012, Herbalife Ltd. (NYSE:HLF) managed to earn 88 cents per share on revenue of $964 million. In the run up to the announcement of these numbers, whisper figures indicated that the firm would post earnings a cent above consensus.

The big story concerning Herbalife Ltd. (NYSE:HLF) is not its earnings or financial performance, but the hedge fund drama that is unfolding around the company’s stock. Two groups of investors, one maintaining that the company is a pyramid scheme and a scam, and the other defending its business, have lined up on either side of the equity.

Last week, news emerged that the candidates nominated to the board of the company by investor Carl Icahn had been accepted onto the board of the company. Icahn, who is battling attempts to short the company, holds more than 15 percent of outstanding Herbalife Ltd. (NYSE:HLF) shares, and has permission to increase his stake up to 25 percent.

Since the start of the year, Herbalife Ltd. (NYSE:HLF) shares have increased in price by more than 16 percent. Despite the big campaign to short the company, led by Bill Ackman, the firm’s stock has managed to continually gain value in the new year. Those shorting the firm will be hoping regulatory pressure mounts on the company some time in 2013.

In the last twelve months Herbalife Ltd. (NYSE:HLF) stock has lost more than 45 percent of its value. Much of that loss happened after famed short investor David Einhorn showed up on the company’s conference call this time last year, and poked holes in the firm’s business model. Bill Ackman’s attempt to short the firm have not been quite as successful so far.

After investors failed to recognize Bill Ackman’s arguments about the firm’s value, it seems his only hope is that regulators step in and disrupt the company’s business. Without action by officials, he stands to lose a great deal of money on his bet against the firm.