Herbalife Ltd. (NYSE:HLF) disappointed in its latest earnings report, and many analysts say it’s because of the new compliance measures the company is putting in place. In the wake of that earnings report, analysts have been slashing their price targets for Herbalife right and left. The latest to cut its price target is Barclays, although the firm is maintaining its Overweight rating on the nutritional supplements company.

Herbalife Ltd. HLF

Meanwhile Bill Ackman’s Pershing Square Capital Management is appealing to Pamela Jones Harbour, the former Federal Trade Commission official Herbalife selected as its new compliance chief.

Herbalife price target cut by 15%

In their report dated Nov. 5, 2014, analysts Meredith Adler, Eric Cohen and Sean Kras said they reduced their price target for Herbalife from $94 to $80 per share. They say the recent changes Herbalife has begun making as being necessary, saying, “Doing the right think can hurt.”

Among the changes the multi-level marketing company is making are putting a limit on the size of a first order someone can make. Also Herbalife has upped the standards needed in order to qualify to be a sales leader.

Wait and see

Analysts at Barclays say these changes are costing Herbalife’s sales volume by a greater amount than management previously expected. However, they think the changes will make the company stronger and healthier. The Barclays team said the test markets where Herbalife has been trying out these changes indicate that retention and productivity are both higher in those markets.

Additionally, they said it’s now up to investors to decide whether the changes Herbalife is making will eventually lead to a reacceleration in growth.

Pershing Square requests a meeting with Herbalife compliance officer

On Thursday, Pershing Square sent a letter to Herbalife compliance chief Pamela Jones Harbour to request a meeting. The firm calls the challenge of bringing the company into compliance with the rules “immense” and “an enormous undertaking, especially given the lax attitude toward compliance that has existed at Herbalife in the past.”

Ackman’s firm adds that the company might have to choose between compliance or recruitment because the more clearly it states that distributors might not be successful in signing up, the less likely they will sign up. He also reminds her that 88% don’t earn anything from Herbalife and that the majority of the money goes to the top 1% of people at the company. Because of these factors and others, the firm state that it’s unlikely Jones Harbor will be able to both comply with the rules and also continue heavy recruitment.

In the letter, Pershing Square references the number of price target cuts from analysts who are bullish on Herbalife, including the report from Barclays and the ‘infamous’ Tim Ramey. The firm also offers an extensive list of what it calls “minimum requirements for a compliance program.

For those who wish to read the letter in its entirety, it can be found here.