Shares of Herbalife surged on Monday for the second straight session, as the company appears to redouble its efforts to combat hedge fund manager Bill Ackman's claims that the company is a "pyramid scheme" set to be shut down.
Herbalife's CFO, John DiSimone, is currently traveling the country speaking to investors, according to one analyst who declined to be named. Another source on the Street confirmed that corporate management is meeting and arranging dinners with big investors in several cities.
When reached on the phone, the company's director of public relations, Michael Gutierrez, refused to comment.
DeSimone has previously attacked Ackman in the press, even saying that the company may look to sue the investor.
The development is just the latest in a string of positive events for the vitamin supplement company.
Earlier this month, The Wall Street Journal reported that federal prosecutors have probed the statements of contractors hired by Pershing Square, Ackman's company. This was widely seen as a good sign by Herbalife bulls.
And in another piece of good-looking news, a California judge dismissed a class-action suit alleging the company is a pyramid scheme.
An attorney for Herbalife said at a hearing that the suit's plaintiffs "slavishly copied from the Ackman allegations," Law360 reported.
In a press release following the dismissal, Herbalife used more muted language, saying that the company "welcomes" the decision, and adding that "we are confident in the strong fundamentals of our business model."
Pershing Square Capital Management countered in a press release of their own that "the Court's decision did not address in any way whether Herbalife is an illegal pyramid scheme, nor did the Court exonerate or bless Herbalife's business practices. "
Ackman announced his short position in December 2012, later telling Bloomberg that he got short when the stock was trading at $47 or $48. He later converted most of his short position to a long put position.
With Monday's rally, the stock cracked the $48 level, before retreating to close at $45, meaning he is likely underwater on the position.