What does it mean to invest in Herbalife (NYSE:HLF) today? For one thing, few seem to have truly invested in the stock as much as made a trade. After Pershing Square's billion-dollar short, fellow activist fund Third Point took the other side of the trade and rode the stock price back up, only to dump the position six months later. Carl Icahn's near-17% position in the multilevel marketer of nutrition products seems to be in part based on a grudge against Pershing CEO Bill Ackman, who has described Herbalife as a Ponzi scheme. The company's financials continue to improve, and the stock is far above the mid-$20 range that it hit upon announcement of Pershing's short. But even while Herbalife continues to rake in cash, more and more questions bubble up to the surface.

Do the numbers matter?
It seems like a silly question to ask when evaluating a stock, but in this case the answer might be no.

On Tuesday, the company posted preliminary fourth-quarter results that show earnings in the range of $1.26 to $1.30 per share -- far above analyst expectations. Herbalife also announced an increase of its current share buyback to $1.5 billion, which was 50% more than expected. The company guided for 6.5% to 8.5% volume shipment growth in the current year.

Also interesting was the announcement of a $1 billion convertible debt offering. Given the copious amounts of cash that Herbalife generates, levering up is an easy way to juice shareholder value. But the structure of the debt deal seems somewhat odd.

The thing is, all of the facts and figures regarding Herbalife are predicated on the idea that the company is operating legally. If the company has successfully navigated regulations and is in the clear (which many think it is), then Herbalife is indeed doing great for its investors and remains an undervalued stock. If the flip side is true, then none of it matters -- the stock would go to zero.

Herbalife and its antagonists continue to present cases that point to their respective intentions. Herbalife's new auditor, PricewaterhouseCoopers, reviewed the last three years of its financials and showed no discrepancies in a report delivered in December. The numbers may add up, but the real question is whether Herbalife's income comes from recruitment or actual sales. This would be hard to prove either way on financial statements.

Pershing Square put up a new website, this one with a list of Herbalife's most egregious alleged offenders -- from distributors to executives. Senator Ed Markey, D-Mass., recently sent letters to the FTC and SEC asking for a full investigation into the company's practices. The League of United Latin American Citizens this week met with the FTC chief to press its own allegations of wrongdoing.

Most people seem to quietly agree that Herbalife benefits from the economically disadvantaged, but that isn't something that will hold up in court. The reality of the situation is likely that both sides are right to a degree. Ackman's allegations of total moral absence are well-based. At the same time, Herbalife could very well be operating in a legal gray area that crosses no boundaries.

In the end, the best recommendation to investors is to completely ignore the stock. It's simply not worth the bet on either side, because the only factor that will truly settle the dispute is the government ('nuff said).

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.