Medifast, Inc., through its subsidiaries, engages in the manufacture and sale of weight loss, weight management, and healthy living products in the United States and the Asia-Pacific. It offers bars, puffs, cereal, crunchers, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups under the OPTAVIA, OPTAVIA ACTIVE, and Optimal Health brand names. The company markets its products through point-of-sale transactions, as well as through ecommerce platform. Medifast, Inc. was founded in 1980 and is headquartered in Baltimore, Maryland.

MEDIFAST INC

A month has gone by since the last earnings report for Medifast (MED). Shares have added about 6.5% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Medifast due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
Medifast's Q2 Earnings Beat Estimates
Medifast delivered second-quarter 2025 results, wherein both the top and bottom lines beat the Zacks Consensus Estimate. Both net sales and earnings experienced year-over-year declines.
MED reported quarterly earnings of 22 cents per share, reflecting a gain from its investment in LifeMD. Excluding this gain, the adjusted earnings were four cents per share comparing favorably with the Zacks Consensus Estimate of break-even earnings. The company reported earnings of 92 cents per share in the year-ago quarter.
Net revenues of $105.6 million declined 37.4% year over year due to a drop in the number of active earning OPTAVIA coaches. However, the metric exceeded the Zacks Consensus Estimate of $95 million. The average revenue per active earning OPTAVIA Coach was $4,630, down 6.9% year over year from $4,972, mainly driven by pressure in client acquisition with challenges in the operating landscape, including rapid adoption of GLP-1 medications for weight loss.
The number of active earning OPTAVIA Coaches has been going downward year over year since the first quarter of 2023, thanks to persistent challenges with client acquisition. The total number of active earning OPTAVIA coaches plunged 32.7% to 22,800 from 33,900 seen in the year-earlier quarter.
Gross profit was $76.6 million, down 37.9% year over year on lower revenues. The gross margin was 72.6%, down 60 basis points (bps) year over year. We expected gross profit to be $83.7 million in the second quarter.
Selling, general and administrative expenses (SG&A) fell 40.8% year over year to $77.7 million. This decrease was primarily caused by a $24.3 million reduction in OPTAVIA coach compensation due to lower volume and fewer active earning coaches. As a percentage of revenues, SG&A declined 430 bps year over year to 73.6% of revenues on roughly 740 bps for supply-chain optimization initiatives and 180 bps for cancellation of the OPTAVIA convention incurred in the year-earlier quarter. This was somewhat offset by 440 bps owing to the loss of leveraged fixed costs on reduced sales volumes.
The loss from operations improved 86.5% to $1.1 million. As a percentage of revenues, loss from operations was 1% for the reported quarter compared with 4.7% in the year-ago period.
Medifast’s Financial Health Snapshot
MED concluded the quarter with cash, cash equivalents and investment securities of $162.7 million, no debt (as of June 30, 2025) and total shareholders’ equity of $216 million.
The company expects third-quarter 2025 revenues between $70 million and $90 million, with the bottom line ranging from a loss of 60 cents to break-even.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -116.67% due to these changes.
VGM Scores
At this time, Medifast has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Medifast has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Medifast is part of the Zacks Food - Miscellaneous industry. Over the past month, Lamb Weston (LW), a stock from the same industry, has gained 6.4%. The company reported its results for the quarter ended May 2025 more than a month ago.
Lamb Weston reported revenues of $1.68 billion in the last reported quarter, representing a year-over-year change of +4%. EPS of $0.87 for the same period compares with $0.78 a year ago.
Lamb Weston is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of -26%. Over the last 30 days, the Zacks Consensus Estimate has changed -6.8%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Lamb Weston. Also, the stock has a VGM Score of A.
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Medifast (MED) Up 6.5% Since Last Earnings Report: Can It Continue?

Medifast, Inc. (MED) is strategically positioning itself at the intersection of health, nutrition and lifestyle coaching. Amid growing consumer demand for health and wellness solutions, MED has been emphasizing the importance of personalized support through its OPTAVIA program, which offers one-on-one coaching and tailored plans.
The company continues to expand its portfolio of nutritionally-balanced meals and supplements, offering options tailored to diverse consumer needs. It is redefining itself as a comprehensive health partner by broadening its wellness platform to cover areas like healthy motion, hydration, sleep and mental well-being.
Technology and personalization are core pillars of Medifast’s strategy, driving deeper engagement and sustainable growth. The company is enhancing its digital tools and apps to improve customer engagement, track progress and connect consumers more seamlessly with their independent OPTAVIA coaches.
The company has an integrated phased way, with the broadening of its product portfolio through the introduction of the ACTIVE and ASCEND lines, hence currently expanding into enhancements to its mobile app and web platform. Such changes are designed to deliver actionable insights, simplify coach reporting as well as modernize its coach economics and product pricing models.
Looking ahead, Medifast is prioritizing the revitalization of its coach and customer base by introducing enhanced tools, data-driven support and new products, with a strategic focus on restoring long-term growth and profitability. Hence, Medifast is positioning itself as a holistic partner in lifestyle transformation by expanding its range of nutrition and wellness solutions.
MED’s Price Performance, Valuation and Estimates
Medifast’s shares have lost 22.1% year to date compared with the industry’s 6.7% dip.
Image Source: Zacks Investment Research
From a valuation standpoint, MED trades at a forward price-to-sales ratio of 0.33X compared with the industry’s average of 1.11X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MED’s 2025 earnings per share (EPS) indicates a year-over-year decline of 125.5% while that of 2026 shows growth of 40.4%. The company’s EPS estimate for 2025 and 2026 has been stable in the past 30 days.
Image Source: Zacks Investment Research
Medifast currently carries a Zacks Rank #3 (Hold).
Stocks to Consider in the Consumer Staples Space
Nomad Foods (NOMD), which manufactures frozen foods, currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NOMD delivered a trailing four-quarter earnings surprise of 3.8%, on average. The Zacks Consensus Estimate for Nomad Foods’ current financial-year EPS indicates growth of 6.7% from the year-ago number.
Mondelez International (MDLZ), which is a leader in the snack food industry, currently carries a Zacks Rank #2 (Buy).
MDLZ delivered a trailing four-quarter earnings surprise of 9%, on average. The Zacks Consensus Estimate for MDLZ’s current financial-year sales indicates growth of 5.8% from the year-ago number.
Ingredion Incorporated (INGR), which is a provider of ingredient solutions specialized in nature-based sweeteners, starches and nutrition ingredients, currently carries a Zacks Rank of 2.
The Zacks Consensus Estimate for INGR’s current financial-year EPS is expected to rise 6.7% from the corresponding year-ago reported figure. INGR delivered a trailing four-quarter earnings surprise of 11.1%, on average.
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Medifast Bolsters Growth Through Health & Wellness Solutions

The following are today's upgrades for Validea's Book/Market Investor model based on the published strategy of Joseph Piotroski. This value-quant strategy screens for high book-to-market stocks, and then separates out financially sound firms by looking at a host of improving financial criteria.
MEDIFAST INC (MED) is a small-cap growth stock in the Biotechnology & Drugs industry. The rating according to our strategy based on Joseph Piotroski changed from 0% to 80% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Medifast, Inc. is a health and wellness company. The Company provides a habit-based and coach-guided lifestyle solution OPTAVIA, which provides people with a comprehensive approach to help them achieve lasting optimal health and wellbeing. OPTAVIA's lifestyle plans deliver clinically proven health benefits as well as evidence-based tools, including scientifically developed products and a framework for habit creation reinforced by independent coaches and community support. Through a collaboration with the virtual primary care provider LifeMD, Inc (LifeMD), OPTAVIA customers have access to board-certified affiliated clinicians and medications, such as GLP-1s, that support treatment plans for obesity and other health conditions. OPTAVIA Coaches introduce customers to a set of healthy habits, and offer OPTAVIA-branded products, including Fuelings as well as OPTAVIA ACTIVE, a line of essential amino acid supplements and protein powders. Its operations are conducted through its subsidiaries.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
BOOK/MARKET RATIO:
PASS
RETURN ON ASSETS:
PASS
CHANGE IN RETURN ON ASSETS:
FAIL
CASH FLOW FROM OPERATIONS:
PASS
CASH COMPARED TO NET INCOME:
PASS
CHANGE IN LONG TERM DEBT/ASSETS
PASS
CHANGE IN CURRENT RATIO:
PASS
CHANGE IN SHARES OUTSTANDING:
PASS
CHANGE IN GROSS MARGIN:
PASS
CHANGE IN ASSET TURNOVER:
FAIL
Detailed Analysis of MEDIFAST INC
MED Guru Analysis
MED Fundamental Analysis
SAFE BULKERS INC (SB) is a small-cap value stock in the Water Transportation industry. The rating according to our strategy based on Joseph Piotroski changed from 60% to 80% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Safe Bulkers, Inc. is a holding company. The Company's principal business is the acquisition, ownership and operation of drybulk vessels. The Company's vessels operate across the world, carrying drybulk cargo for the consumers of marine drybulk transportation services. The Company is an international provider of marine drybulk transportation services, transporting bulk cargoes, particularly coal, grain and iron ore, along shipping routes across the world. As of February 17, 2017 the Company's fleet included 38 vessels, of which 14 are Panamax class vessels, nine are Kamsarmax class vessels, 12 are Post-Panamax class vessels and three are Capesize class vessels, with an aggregate carrying capacity of 3,421,800 deadweight tonnage (dwt). The Company's fleet of Post-Panamax vessels includes Marina, Xenia, Sophia, Eleni, Martine, Andreas K, Panayiota K, Venus Heritage, Venus History, Venus Horizon and Troodos Sun. Its fleet of Capesize vessels includes Kanaris, Pelopidas and Lake Despina.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
BOOK/MARKET RATIO:
PASS
RETURN ON ASSETS:
PASS
CHANGE IN RETURN ON ASSETS:
PASS
CASH FLOW FROM OPERATIONS:
PASS
CASH COMPARED TO NET INCOME:
PASS
CHANGE IN LONG TERM DEBT/ASSETS
PASS
CHANGE IN CURRENT RATIO:
FAIL
CHANGE IN SHARES OUTSTANDING:
PASS
CHANGE IN GROSS MARGIN:
FAIL
CHANGE IN ASSET TURNOVER:
PASS
Detailed Analysis of SAFE BULKERS INC
SB Guru Analysis
SB Fundamental Analysis
CONSENSUS CLOUD SOLUTIONS INC (CCSI) is a small-cap value stock in the Software & Programming industry. The rating according to our strategy based on Joseph Piotroski changed from 70% to 80% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Consensus Cloud Solutions, Inc. is a digital fax provider. The Company provides secure information delivery services with a scalable software-as-a-service platform. It provides data transformation solutions for regulated industries such as healthcare, finance, insurance, real estate and manufacturing, as well as technology for state and the federal government. Its solutions consist of cloud faxing; digital signature; intelligent data extraction using natural language processing and artificial intelligence; robotic process automation; interoperability; workflow enhancement, and a connectivity and integration engine for healthcare providers. The Company's solutions can be combined with managed services for optimal outcomes. Its small office/home office (SoHo) brands include eFax, jSign, MyFax, Sfax, Metrofax, and SRfax. Its solutions include eFax Corporate, ECFax, Unite, jSign, Conductor, Clarity and eFax. Conductor is a robust interface engine and complete interoperability platform.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
BOOK/MARKET RATIO:
PASS
RETURN ON ASSETS:
PASS
CHANGE IN RETURN ON ASSETS:
PASS
CASH FLOW FROM OPERATIONS:
PASS
CASH COMPARED TO NET INCOME:
PASS
CHANGE IN LONG TERM DEBT/ASSETS
PASS
CHANGE IN CURRENT RATIO:
FAIL
CHANGE IN SHARES OUTSTANDING:
PASS
CHANGE IN GROSS MARGIN:
FAIL
CHANGE IN ASSET TURNOVER:
PASS
Detailed Analysis of CONSENSUS CLOUD SOLUTIONS INC
CCSI Guru Analysis
CCSI Fundamental Analysis
Joseph Piotroski Portfolio
About Joseph Piotroski: Piotroski isn't your typical Wall Street big shot. In fact, he's not even a professional investor. He's a good old numbers-crunching accountant and college professor. But in 2000, shortly after he started teaching at the University of Chicago's Graduate School of Business, Piotroski published a groundbreaking paper in the Journal of Accounting Research entitled "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers". In it, Piotroski laid out an accounting-based stock-selection/shorting method that produced a 23 percent average annual back-tested return from 1976 through 1996 -- more than double the S&P 500's gain during that time. Piotroski's findings were reported in major financial publiations like SmartMoney. Today, he teaches accounting at Stanford University's Graduate School of Business.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Validea Joseph Piotroski Strategy Daily Upgrade Report - 2/20/2025

Medifast (MED) came out with quarterly earnings of $0.10 per share, beating the Zacks Consensus Estimate of a loss of $0.27 per share. This compares to earnings of $1.09 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 137.04%. A quarter ago, it was expected that this weight-loss company would post a loss of $0.15 per share when it actually produced earnings of $0.35, delivering a surprise of 333.33%.
Over the last four quarters, the company has surpassed consensus EPS estimates three times.
Medifast, which belongs to the Zacks Food - Miscellaneous industry, posted revenues of $119 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 7.70%. This compares to year-ago revenues of $191.02 million. The company has topped consensus revenue estimates four times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Medifast shares have lost about 8% since the beginning of the year versus the S&P 500's gain of 4%.
What's Next for Medifast?
While Medifast has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Medifast: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.10 on $148.21 million in revenues for the coming quarter and $0.51 on $566.19 million in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Miscellaneous is currently in the bottom 27% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Smucker (SJM), another stock in the same industry, has yet to report results for the quarter ended January 2025. The results are expected to be released on February 27.
This food maker is expected to post quarterly earnings of $2.35 per share in its upcoming report, which represents a year-over-year change of -5.2%. The consensus EPS estimate for the quarter has been revised 0.6% lower over the last 30 days to the current level.
Smucker's revenues are expected to be $2.23 billion, down 0% from the year-ago quarter.
Should You Invest in MEDIFAST INC (MED)?
Before you invest in MEDIFAST INC (MED), want to know the best stocks to buy for the next 30 days? Check out Zacks Investment Research for our free report on the 7 best stocks to buy.
Zacks Investment Research has been committed to providing investors with tools and independent research since 1978. For more than a quarter century, the Zacks Rank stock-rating system has more than doubled the S&P 500 with an average gain of +24.08% per year. (These returns cover a period from January 1, 1988 through May 6, 2024.)
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Medifast (MED) Q4 Earnings and Revenues Beat Estimates

Medifast, Inc. MED is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 17.60, higher than the industry average of 15.39. This inflated valuation suggests that the market is pricing in high growth expectations, but it also raises questions about whether the company can deliver results that justify such a premium.
Image Source: Zacks Investment Research
Shares of Medifast have tumbled 9.6% in the past three months compared with the industry’s decline of 6.8%. This weight loss, weight management and healthy living products company trailed the broader Zacks Consumer Staples sector’s fall of 4.6% and the S&P 500's growth of 4.9% during the same period.
Image Source: Zacks Investment Research
While a high valuation and the stock's recent underperformance suggest caution, the company's efforts to keep pace with the evolving consumer trends may appeal to investors.
Current Challenges for Medifast
Medifast has been encountering difficulties in attracting customers due to macroeconomic challenges, including intense competition in the health and wellness space, the disruptive effects of GLP-1 regimen adoption and a general slowdown in consumer spending. Undoubtedly, the weight loss market has experienced significant changes, with the adoption of medically supported weight loss accelerating more rapidly than anticipated.
In the third quarter of 2024, net revenues of $140.2 million declined 40.6% year over year due to fewer active-earning OPTAVIA Coaches and reduced coach productivity. The average revenue per active-earning OPTAVIA Coach was $4,672, down from $5,008 million due to softness in customer acquisition. The total number of active-earning OPTAVIA Coaches fell 36.3% to 30,000 from 47,100 in the year-ago quarter.
Medifast has been battling rising SG&A costs for a while, which is denting its profits. As a percentage of revenues, SG&A expenses increased 950 bps to 73.9% in the third quarter of 2024. This was primarily driven by around 590 bps related to company-led customer acquisition efforts and 340 bps linked to reduced leverage on fixed costs due to declining sales volumes. The adjusted income from operations declined 85.3% to $3.8 million, while the adjusted operating margin decreased 810 bps year over year to 2.7% in the third quarter.
As the operating landscape remains difficult, Medifast intends to make significant spending to boost customer acquisition. These initiatives involve strategic investments in marketing and product development, which are crucial for driving long-term growth. However, these investments may negatively affect EPS in the short term.
What to Expect From MED in Q4?
Medifast expects fourth-quarter revenues to range between $100 million and $120 million. This reflects a continued decline in active-earning OPTAVIA Coaches, driven by near-term challenges in customer acquisition due to the growing adoption of GLP-1 medications in the market. Management forecasts a loss per share for the fourth quarter in the range of 10-65 cents. This guidance includes an expected $7 million in spending for company-led marketing during the quarter.
MED’s Growth Strategy on Track
Medifast is strategically positioning itself to thrive in the rapidly evolving weight loss market, particularly as the adoption of GLP-1 medications reshapes industry dynamics. With the launch of OPTAVIA ASCEND in early 2025, Medifast is positioning itself to meet the unique nutritional needs of GLP-1 users. With projections indicating that the GLP-1 support market could reach $50 billion or more by 2030, Medifast is seizing this transformative opportunity by aligning its efforts with the market's evolving needs. The company's holistic approach, integrating customers, coaches and clinicians through LifeMD, uniquely positions it to support GLP-1 users in achieving their long-term health goals.
Medifast diligently pursues a strategic vision aimed at driving long-term growth. This vision encompasses several key initiatives, including the cultivation of product and program innovation, expansion into diverse market segments and geographies, refinement of coach and client experiences, harnessing in-depth data and insights and streamlining operational efficiency.
Medifast’s OPTAVIA coach network remains a crucial asset, with more than 95% of coach leaders trained to support clients using GLP-1 medications. The company’s coach-led model, which incorporates lifestyle guidance with scientifically developed products, has the potential to attract and retain clients looking for structured support in their health journey.
The company is also progressing well with the 'Fuel for the Future' program, a strategic initiative aimed at optimizing expenditures across the business, freeing up capital for targeted investments in growth initiatives while concurrently bolstering profit margins. Through this plan, the company has been fueling efficiency and reducing costs.
Investors’ Guide to MED Stock
Medifast’s elevated valuation and recent underperformance relative to peers are concerning. The company is contending with customer acquisition challenges amid several macroeconomic hurdles, alongside encountering elevated costs. While these obstacles pose concerns for the near term, strategic growth initiatives like keeping pace with the evolving weight loss market keep Medifast well-positioned for long-term success. Current investors should retain their positions in MED stock, while new investors might wait for a more favorable entry point. The company currently carries a Zacks Rank #3 (Hold).
Top Three Consumer Staple Picks
Ingredion Incorporated INGR manufactures and sells sweeteners, starches, nutrition ingredients and biomaterial solutions derived from wet milling and processing corn and other starch-based materials. The company currently sports a Zacks Rank #1 (Strong Buy). INGR has a trailing four-quarter earnings surprise of 9.5%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Ingredion’s current financial year’s earnings indicates growth of 12.5% from the year-ago reported number.
Freshpet Inc. FRPT manufactures, distributes and markets natural fresh meals and treats for dogs and cats. It currently carries a Zacks Rank #2 (Buy). FRPT has a trailing four-quarter earnings surprise of 144.5%, on average.
The Zacks Consensus Estimate for Freshpet’s current financial-year sales and earnings indicates growth of 27.3% and 224.3%, respectively, from the prior-year reported levels.
McCormick & Company MKC, which manufactures, markets and distributes spices, seasoning mixes, condiments and other flavorful products, currently carries a Zacks Rank #2. MKC has a trailing four-quarter earnings surprise of 13.8%, on average.
The Zacks Consensus Estimate for McCormick’s current fiscal-year sales and earnings indicates growth of 0.6% and 8.2%, respectively, from the prior-year reported levels.
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How Should You Play Medifast Stock at a P/E Multiple of 17.6X?

A month has gone by since the last earnings report for Medifast (MED). Shares have lost about 11.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Medifast due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Medifast Q2 Earnings Beat Estimates, Revenues Dip Y/Y
Medifast delivered second-quarter 2024 results, with the bottom and top lines declining year over year. However, both earnings and net revenues beat the Zacks Consensus Estimate.
Medifast is strategically adjusting its operations to meet the changing demands of the weight loss industry. This involves expanding its customer outreach through enhanced marketing efforts and entering the medically supported weight loss domain in partnership with LifeMD. These steps are designed to increase its market presence and cater to a wider audience, highlighting a forward-looking approach aimed at driving growth and adapting to market dynamics despite the competitive landscape of the weight loss sector.
Medifast’s adjusted earnings were 92 cents per share in the second quarter, down from $2.77 in the year-ago quarter. The metric surpassed the Zacks Consensus Estimate of earnings of 36 cents per share.
Net revenues of $168.9 million declined 43.1% year over year mainly due to lesser active earning OPTAVIA Coaches and reduced productivity per Coach. The average revenue per active earning OPTAVIA Coach was $4,972, down 10.9% year over year from $5,578 million due to lower customer acquisition. The total number of active earning OPTAVIA Coaches fell 36.2% to 33,900 from 53,100 in the year-ago quarter. The top line surpassed the Zacks Consensus estimate of $160 million.
The adjusted gross profit was $126 million, down 40.2% year over year on reduced revenues. The adjusted gross profit margin was 74.8%, up 370 basis points year over year. This increase mainly resulted from the cost reductions achieved through the company's Fuel for the Future initiative, coupled with efficient inventory management.
Adjusted selling, general and administrative expenses (SG&A) fell 33.8% year over year to $113.8 million. The decrease was primarily attributed to several factors, including reduced Coach compensation due to lower sales volumes and fewer active earning Coaches.
As a percentage of revenues, adjusted SG&A expenses increased 940 basis points (bps) to 67.5%, primarily attributed to the loss of leverage on fixed costs due to lower sales volumes and supply-chain optimization costs. Additionally, the company incurred expenses for market research and investments in medically supported weight loss, costs for exiting hotel commitments for future annual OPTAVIA conventions reflecting a strategic change and costs for company-led customer acquisition initiatives. We expected adjusted SG&A expenses, as a percentage of revenues, to increase 600 bps to 64.1% in the second quarter.
The adjusted income from operations declined 68.4% to $12.2 million. We note that the adjusted operating margin decreased 580 bps year over year to 7.3%.
Other Financial Updates & Guidance
Medifast concluded the quarter with cash, cash equivalents and investments of $165.3 million, no interest-bearing debt (as of Jun 30, 2024) and total shareholders’ equity of $205.3 million.
Management expects revenues to be in the range of $125-$145 million for the third quarter. The company projects loss per share to be in the band of 5-70 cents. The earnings per share guidance excludes costs associated with the initiation of the partnership with LifeMD, as well as any gains or losses related to changes in the market price of the company’s LifeMD investment.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -107.14% due to these changes.
VGM Scores
Currently, Medifast has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Medifast has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Medifast belongs to the Zacks Food - Miscellaneous industry. Another stock from the same industry, Sysco (SYY), has gained 4.1% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Sysco reported revenues of $20.56 billion in the last reported quarter, representing a year-over-year change of +4.2%. EPS of $1.39 for the same period compares with $1.34 a year ago.
Sysco is expected to post earnings of $1.14 per share for the current quarter, representing a year-over-year change of +6.5%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Sysco has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Medifast (MED) Down 11.5% Since Last Earnings Report: Can It Rebound?

Medifast (MED) shares ended the last trading session 5.9% higher at $36.61. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 32.8% loss over the past four weeks.
Medifast’s shares have been gaining on optimism surrounding efforts to broaden its presence in the expansive health and wellness market. The company is foraying into popular medically supported weight management and sports nutrition segments. Medifast’s investments towards enhancing customer acquisition and experience is a driver.
This weight-loss company is expected to post quarterly earnings of $0.58 per share in its upcoming report, which represents a year-over-year change of -84.2%. Revenues are expected to be $166.01 million, down 52.4% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Medifast, the consensus EPS estimate for the quarter has been revised 66.3% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on MED going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Medifast is part of the Zacks Food - Miscellaneous industry. General Mills (GIS), another stock in the same industry, closed the last trading session 1.9% higher at $66.76. GIS has returned 3.6% in the past month.
General Mills' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $1.04. Compared to the company's year-ago EPS, this represents a change of +7.2%. General Mills currently boasts a Zacks Rank of #3 (Hold).
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Medifast (MED) Soars 5.9%: Is Further Upside Left in the Stock?

Medifast, Inc. MED delivered fourth-quarter 2023 results, with the top and bottom lines declining year over year. However, both earnings and net revenues beat the Zacks Consensus Estimate.
Medifast is strategically adjusting its operations to meet the changing demands of the weight loss industry. This involves expanding its customer outreach through enhanced marketing efforts and entering the medically supported weight loss domain in partnership with LifeMD.
These steps are designed to increase its market presence and cater to a wider audience, highlighting a forward-looking approach aimed at driving growth and adapting to market dynamics despite the competitive landscape of the weight loss sector.
MEDIFAST INC Price, Consensus and EPS Surprise
Q4 in Details
Medifast’s adjusted earnings were $1.09 per share in the fourth quarter of 2023, down from the $3.70 reported in the year-ago quarter. The metric surpassed the Zacks Consensus Estimate of 99 cents.
Net revenues of $191 million declined 43.4% year over year mainly due to lesser active earning OPTAVIA Coaches and reduced productivity per active earning OPTAVIA Coach. The average revenue per active earning OPTAVIA Coach stood at $4,648, down 16.1% from $5,538 million due to lower customer acquisition. The total number of active earning OPTAVIA Coaches fell 32.5% to 41,100 compared with 60,900 in the year-ago quarter. The top line surpassed the Zacks Consensus estimate of $174 million.
The adjusted gross profit came in at $141.4 million, down 42.5% year over year on reduced revenues. The adjusted gross profit margin was 74%, up 110 basis points year over year. This increase mainly resulted from the cost reductions achieved through the company's Fuel for the Future initiative, coupled with the lack of restructuring expenses that were present in the previous year's period.
Adjusted selling, general and administrative expenses (SG&A) fell 35% year over year to $125.1 million. The decrease was primarily attributed to several factors, including reduced Coach compensation due to lower sales volumes and fewer active earning Coaches, as well as the progress made in various cost reduction and optimization initiatives. Additionally, charitable donations made in 2022 contributed to the decrease.
As a percentage of revenues, adjusted SG&A expenses increased 840 basis points (bps) to 65.5%, primarily attributed to the reduced leverage on fixed costs resulting from decreased sales volumes, as well as costs associated with market research and investments in medically supported weight loss endeavors. This was somewhat mitigated by advancements in various cost reduction and optimization efforts, along with the impacts of charitable donations made in 2022. We expected adjusted SG&A expenses, as a percentage of revenues, to increase 760 bps to 64.7% in the fourth quarter.
The adjusted income from operations declined 69.5% to $16.2 million mainly due to a decrease in gross profit. However, this was partially mitigated by reduced SG&A expenses. The adjusted operating margin decreased 730 basis points year over year to 8.5%.
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Other Financial Updates
Medifast concluded the quarter with cash, cash equivalents and investments of $150 million, no interest-bearing debt (as of Dec 31, 2023), and total shareholders’ equity of $201.5 million.
Guidance
Management expects revenues of $155-$175 million for first-quarter 2024. The company expects adjusted earnings per share (EPS) of 25-35 cents for the first quarter.
In 2023, revenues fell 32.9% to $1.1 billion from $1.6 billion in 2022. Adjusted earnings declined 33.5% year over year to $9.64 per share.
The Zacks Rank #5 (Strongly Sell) company’s shares have lost 34% in the past three months against the industry’s 4.6% growth.
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Lamb Weston is a leading global manufacturer, marketer and distributor of value-added frozen potato products. It currently has a Zacks Rank #2 (Buy). LW has a trailing four-quarter earnings surprise of 28.8% on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal-year sales and earnings suggests growth of 28.3% and 26.9%, respectively, from the fiscal 2023 reported figures.
Vital Farms offers a range of produced pasture-raised foods. It currently carries a Zacks Rank #2. VITL has a trailing four-quarter earnings surprise of 145%, on average.
The Zacks Consensus Estimate for Vital Farms’ current financial-year sales suggests growth of 29% from the 2022 reported figure.
Inter Parfums is engaged in the manufacturing, distribution and marketing of a wide range of fragrances and related products. The company currently has a Zacks Rank #2.
The Zacks Consensus Estimate for Inter Parfums’ current financial-year earnings and sales indicates growth of 20.4% and 21.6%, respectively, from the 2022 reported figures. IPAR has a trailing four-quarter average earnings surprise of 45.7%.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Medifast (MED) Q4 Earnings Beat Estimates, Revenues Dip Y/Y

Medifast (MED) came out with quarterly earnings of $1.09 per share, beating the Zacks Consensus Estimate of $0.99 per share. This compares to earnings of $3.70 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 10.10%. A quarter ago, it was expected that this weight-loss company would post earnings of $1.02 per share when it actually produced earnings of $2.12, delivering a surprise of 107.84%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Medifast, which belongs to the Zacks Food - Miscellaneous industry, posted revenues of $191.02 million for the quarter ended December 2023, surpassing the Zacks Consensus Estimate by 9.80%. This compares to year-ago revenues of $337.25 million. The company has topped consensus revenue estimates three times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Medifast shares have lost about 25.6% since the beginning of the year versus the S&P 500's gain of 4.9%.
What's Next for Medifast?
While Medifast has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Medifast: unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $1.72 on $240.81 million in revenues for the coming quarter and $5.73 on $799.58 million in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Miscellaneous is currently in the bottom 41% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
One other stock from the same industry, B&G Foods (BGS), is yet to report results for the quarter ended December 2023. The results are expected to be released on February 27.
This food producer is expected to post quarterly earnings of $0.28 per share in its upcoming report, which represents a year-over-year change of -30%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.
B&G Foods' revenues are expected to be $573.39 million, down 8% from the year-ago quarter.
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Medifast (MED) Q4 Earnings and Revenues Surpass Estimates

Among the underlying components of the Russell 3000 index, we saw noteworthy options trading volume today in Medifast Inc (Symbol: MED), where a total of 1,732 contracts have traded so far, representing approximately 173,200 underlying shares. That amounts to about 57.9% of MED's average daily trading volume over the past month of 298,945 shares. Particularly high volume was seen for the $45 strike put option expiring March 15, 2024, with 414 contracts trading so far today, representing approximately 41,400 underlying shares of MED. Below is a chart showing MED's trailing twelve month trading history, with the $45 strike highlighted in orange:
InMode Ltd (Symbol: INMD) saw options trading volume of 8,706 contracts, representing approximately 870,600 underlying shares or approximately 57.4% of INMD's average daily trading volume over the past month, of 1.5 million shares. Especially high volume was seen for the $22 strike call option expiring March 15, 2024, with 1,804 contracts trading so far today, representing approximately 180,400 underlying shares of INMD. Below is a chart showing INMD's trailing twelve month trading history, with the $22 strike highlighted in orange:
And Arbor Realty Trust Inc (Symbol: ABR) options are showing a volume of 33,260 contracts thus far today. That number of contracts represents approximately 3.3 million underlying shares, working out to a sizeable 57.3% of ABR's average daily trading volume over the past month, of 5.8 million shares. Particularly high volume was seen for the $11 strike put option expiring March 15, 2024, with 7,575 contracts trading so far today, representing approximately 757,500 underlying shares of ABR. Below is a chart showing ABR's trailing twelve month trading history, with the $11 strike highlighted in orange:
For the various different available expirations for MED options, INMD options, or ABR options, visit StockOptionsChannel.com.
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Periodand min./max. price, $	Price change, %		Volatility, %		Volume, $
Periodand min./max. price, $	MED	Industry	MED	Industry	Volume, $
Yesterday 13.4 - 13.9	1.17	2.64	16.17	0.45	1.78M
Week 13.4 - 14.2	-1.43	2.74	6.31	4.76	6.52M
Month 12.7 - 14.4	8.32	2.54	10.62	10.02	33.74M
3 Months 12.6 - 15.5	7.48	2.02	20.77	17.95	133.51M
6 Months 11.6 - 15.5	0.44	11.71	31.81	28.93	256.37M
Year 11.6 - 22.0	-25.08	52.66	44.10	35.21	521.62M
3 years 11.6 - 131.4	-88.59	79.31	80.63	66.09	4.33B
5 years 11.6 - 337.0	-91.64	82.45	103.53	95.56	10.73B
All time 2.6 - 337.0	321.95	196.67	—	—	13.63B

MEDIFAST INC

Price and volatility history

Risk ratios