Herbalife shares rose today as anticipation for the company’s next earnings report rises. The next report is extremely important because investors want to see significant progress in turning around the quarterly sales declines the company has been struggling with. Indeed, Wall Street appears to be expecting good things.

Herbalife Ltd. HLF

Well-known Herbalife bull Tim Ramey of Pivotal Research has released his expectations for the report, which is due on Aug. 5 after closing bell.

What to expect in Herbalife’s earnings report

Wall Street consensus estimates suggest earnings of $1.11 per share and revenue of $1.15 billion. Ramey remains highly bullish on Herbalife, however, with an earnings estimate of $1.17 per share. Herbalife management guided for earnings of between $1.05 and $1.15 per share, possibly setting themselves up for a beat. They raised their full year earnings guidance with the last earnings report, which suggested at that time that the tide could be turning.

Ramey is expecting an 11.8% decline in sales as a result of lower volumes and the strong U.S. dollar.

Why Ramey expects such a wide beat

One of the reasons he remains so much higher than the consensus on earnings is because he found that Herbalife members who attended the Herbalife Extravaganza earlier this month “are seeing a turn in the business and better volume numbers.” At the event, he met with a member of the Chairman’s Club and a member of the Founder’s Circle. He found “palpable enthusiasm” regarding a “positive turn,” and he expects this sentiment to bleed over into next month’s earnings call.

The analyst notes that Herbalife is still in recovery mode due to allegations raised by short-seller Bill Ackman nearly three years ago. Also currency headwinds (which have affected all international U.S.-based companies), problems in China (another broader issue affecting many U.S. companies), and changes in its business model have weighed heavily on Herbalife’s finances.

Ramey maintained his $90 per share price target and Buy rating on the nutritional supplements company.

SEC may have closed Herbalife investigation

Earlier this year, Probes Reporter released evidence that there may have been some kind of investigation involving Herbalife open with the Securities and Exchange Commission. However, there are now signs that the alleged probe is closed.

Ramey submitted two requests to the SEC under the Freedom of Information Act requesting information on “documents related to any SEC investigations” of Herbalife between July 1, 2014 and June 30, 2015. In both cases, the SEC sent letters back stating that there was “no information” on any investigations involving Herbalife. The analyst suggests that this could mean the reported probe was closed at some point before July 1, 2014.

Questions about investigations being open (both officially acknowledged and not) have been an overhang on Herbalife stock for some time, so this could remove one key barrier for the company. Indeed, Ramey’s assertion could be one reason Herbalife shares rallied today. The other overhang is sales numbers, which could be on the verge of a turnaround if Ramey is right.

As of this writing, the stock was up 3.04% at $49.83 per share.

We have reached out to Herbalife for a comment on the matter and will update this post if one is received.