Medifast Earnings Preview

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While Medifast (NYS: MED) missed estimates last quarter, investors hope that it will bounce back and outpace Wall Street expectations this quarter. The company will unveil its latest earnings on Tuesday, March 13. Medifast is engaged in the production, distribution, and sale of weight management and disease management products and other consumable health and diet products.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Medifast, with four of seven rating it a buy and the remainder rating it a hold. Analysts haven't adjusted their rating of Medifast for the past three months.
  • Revenue forecasts: On average, analysts predict $71 million in revenue this quarter. That would represent a rise of 12.6% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.21 per share. Estimates range from $0.16 to $0.27.

What our community says:
CAPS All-Stars are in strong support of the stock, with 78.3% giving it an "outperform" rating. The community at large agrees with the All-Stars, with 84.1% awarding it a rating of "outperform." Medifast's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Medifast's profit has risen year over year by an average of 9.4% over the past five quarters.

Now let's get some insight into how efficient management is at running the business. Margins are a representation of how efficiently a company captures portions of sales dollars. The company's operating margins have been decreasing year over year for the last four quarters. Operating margins reflect the total sales revenue that the company retains after costs. Here is how Medifast has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

74.2%

75.4%

76.3%

74.2%

Operating Margin

8.8%

11.5%

13.5%

8.1%

Net Margin

6.7%

7.6%

8.6%

5.4%

One final thing: If you want to keep tabs on Medifast movements, and for more analysis on the company, make sure you add it to your Watchlist.

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Earnings estimates provided by Zacks.

At the time this article was published

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