A day after analyst Tim Ramey cut his price target on Herbalife Ltd. (NYSE:HLF), we’ve got another cut. In a report dated Nov. 4, 2014, Canaccord Genuity analysts slashed their price target for the company from $73 to $60 per share. They maintained their Buy rating on the stock, however.

Herbalife Ltd. HLF

Herbalife (HLF) valuation reset

Analysts Scott Van Winkle and Mark Sigal note that Herbalife’s business model is now seeing low to mid-single digit growth, so its valuation has been reset again. Meanwhile questions continue to hang on the company as it deals with the Federal Trade Commission’s investigation.

In its latest earnings report, Herbalife Ltd. (NYSE:HLF) missed estimates for adjusted earnings per share, volume and sales by about 5%. The nutritional supplements company did report continued strength in China, but weakness and deceleration in the U.S. more than offset that strength. Herbalife also saw strength in Europe, the Middle East and Africa, but currency exchange changes hid that strength. The company also saw unexpected weakness in Brazil and Mexico.

The nutritional supplements company also provided guidance that was significantly lower than consensus estimates. The Canaccord Genuity team said Herbalife’s volume growth is being challenged and will now probably be in the low single digits in 2015.

Herbalife (HLF) estimates lowered

Because of the earnings miss and the weak guidance, the analysts cut their full year earnings per share estimate from $6.25 to $5.85 per share. For the 2015 fiscal year, their estimate falls from $7.12 to $5.50 per share. They said approximately half of their revision is due to lower growth in volume, while the other half is due to ongoing currency exchange issues.

One of the reasons Herbalife Ltd. (NYSE:HLF)’s guidance was low was due to the phased implementation of adjustments the company is making to its business model. The entire plan will be in effect by February. Among the biggest changes are a limitation on the first orders placed by customers, which will expand to include the entire globe but currently is only followed in 18 markets. Also there will be more restrictions on sales leader qualifications, requiring all qualification volume to be bought directly from Herbalife rather than upline distributors.

Herbalife settles lawsuit

The Canaccord Genuity team sees the recently announced settlement in the Bostick class action lawsuit as a positive. They note that the agreement is still preliminary but say that the terms are “relatively benign” in nature.

Under the terms, Herbalife Ltd. (NYSE:HLF) will pay $15 million, excluding up to $2.5 million in product returns. A court hearing on that settlement is scheduled for Dec. 1, and the analysts think a final settlement that’s similar to what’s already been proposed will be a positive because they think it’s “favorable” to the bigger debate about the company’s business model.