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Medifast (MED)
:MED
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Medifast
(NYSE:MED)
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Rating:46Neutral
Price Target:
$13.00
▲(2.20% Upside)
Medifast's overall stock score reflects significant financial and operational challenges, including declining revenue, profitability, and cash flow issues. Technical analysis indicates bearish momentum, and the valuation suggests the stock is expensive. The earnings call highlighted ongoing struggles, despite some positive developments.
Medifast (MED) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$139.81M
Dividend YieldN/A
Average Volume (3M)140.33K
Price to Earnings (P/E)38.6
Beta (1Y)0.39
Revenue Growth-37.62%
EPS Growth-87.69%
CountryUS
Employees504
SectorConsumer Cyclical
Sector Strength84
IndustryPersonal Products & Services
Share Statistics
EPS (TTM)0.40
Shares Outstanding10,991,064
10 Day Avg. Volume124,312
30 Day Avg. Volume140,334
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.04
Enterprise Value/Revenue0.01
Enterprise Value/Gross Profit0.02
Enterprise Value/Ebitda0.41
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Medifast Business Overview & Revenue Model
Company DescriptionMedifast, Inc., through its subsidiaries, manufactures and distributes weight loss, weight management, healthy living products, and other consumable health and nutritional products in the United States and the Asia-Pacific. The company offers bars, bites, pretzels, puffs, cereal crunch, drinks, hearty choices, oatmeal, pancakes, pudding, soft serves, shakes, smoothies, soft bakes, and soups under the OPTAVIA, Optimal Health by Take Shape for Life, and Flavors of Home brands. It markets its products through point-of-sale transactions over ecommerce platform. The company was founded in 1980 and is headquartered in Baltimore, Maryland.
How the Company Makes MoneyMedifast generates revenue through multiple channels, primarily by selling its meal replacement products and nutritional supplements directly to consumers via its OPTAVIA platform. The company has a unique revenue model that includes the sale of products through a network of independent health coaches who earn commissions on product sales and can build their own client bases. This multi-level marketing approach not only drives product sales but also encourages customer loyalty and community engagement. Additionally, Medifast benefits from subscription services and recurring orders, allowing for consistent revenue flow. Strategic partnerships with healthcare providers and wellness organizations also contribute to Medifast's earnings by expanding its reach and enhancing brand credibility.
Medifast Earnings Call Summary
Earnings Call Date:Aug 04, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 03, 2025
Earnings Call Sentiment Negative
The earnings call presented a mixed picture: while Medifast reported some positive developments such as exceeding guidance, improving coach productivity, and a strong financial position, these were overshadowed by significant declines in revenue and active coaches, as well as challenges in new coach acquisition. The company's cautious third quarter guidance further indicates ongoing struggles.Q2-2025 Updates
Positive Updates
Above-Guidance Revenue and EPS
Revenue for the second quarter was $105.6 million, and EPS was $0.22 per diluted share, both above the guidance ranges.
Strong Financial Position
Medifast reported $162.7 million in cash and cash equivalents with no interest-bearing debt as of June 30, 2025.
Sequential Increase in Coach Productivity
Average revenue per coach increased sequentially for the second consecutive quarter, indicating improving productivity.
Improved Loss from Operations
Loss from operations was $1.1 million, an improvement of $6.8 million compared to the year earlier period.
Successful Launch of Premier+ Program
Launched a new pricing and incentive structure for auto ship clients, simplifying the value proposition and expected to encourage longer client retention.
Negative Updates
Significant Revenue and Coach Declines
Revenue decreased by 37.4% and the number of active earning OPTAVIA coaches decreased by 32.7% compared to the second quarter of 2024.
Decline in Average Revenue Per Coach
Average revenue per active earning OPTAVIA Coach for the second quarter was $4,630, a year-over-year decrease of 6.9%.
Challenges in New Coach Acquisition
New coach acquisition growth declined compared to the prior year, reflecting the absence of promotions.
Lower SG&A Expense but Loss of Leverage
SG&A expense was down 40.8% year-over-year, but there was a loss of leverage on fixed costs due to lower sales volumes.
Cautious Third Quarter Guidance
Third quarter revenue is expected to range from $70 million to $90 million, with earnings per share ranging from $0.00 to a loss of $0.60.
Company Guidance
During the Medifast Second Quarter 2025 Earnings Conference Call, the company reported revenue of $105.6 million, a 37.4% decrease compared to the previous year, primarily due to a decline in active earning OPTAVIA coaches, which totaled 22,800, down 32.7% from Q2 2024. Despite this, average revenue per coach increased sequentially for the second consecutive quarter, reaching $4,630, although this was a 6.9% year-over-year decline. Gross profit was $76.6 million with a margin of 72.6%, down 60 basis points year-over-year. SG&A expenses fell 40.8% to $77.7 million due to decreased coach compensation and non-recurring costs from the previous year. The company achieved a net income of $2.5 million or $0.22 per diluted share, compared to a net loss of $8.2 million in the previous year. Looking ahead, Medifast projects Q3 2025 revenue between $70 million and $90 million, with earnings per share ranging from $0.00 to a loss of $0.60. The company has introduced the Premier+ auto ship program and focuses on metabolic health, with plans to announce additional research findings later this year.Medifast Financial Statement Overview
Summary
Medifast faces financial headwinds with declining revenue and profitability, as well as cash flow challenges. Despite a strong gross profit margin and low leverage, the company needs to address operational inefficiencies and improve cash flow management to enhance financial stability.Income Statement
Medifast's income statement shows declining revenue with a negative growth rate of -11.59% in the TTM period. Gross profit margin remains strong at 73.84%, but net profit margin is low at 0.76%, indicating profitability challenges. The EBIT and EBITDA margins have significantly decreased, reflecting operational inefficiencies.45
Neutral
Balance Sheet
The balance sheet is relatively stable with a low debt-to-equity ratio of 0.06, suggesting low leverage. However, return on equity has decreased to 1.72%, indicating reduced profitability from equity. The equity ratio is not provided, but overall, the company maintains a conservative financial structure.65
Positive
Cash Flow
Cash flow analysis reveals significant challenges, with a free cash flow growth rate of -117.99% in the TTM period. Operating cash flow to net income ratio is low at 0.09, and free cash flow to net income is negative, indicating cash flow issues and potential liquidity concerns.30
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 480.45M | 602.46M | 1.07B | 1.60B | 1.53B | 934.84M |
| Gross Profit | 354.78M | 444.62M | 775.85M | 1.14B | 1.13B | 697.82M |
| EBITDA | 14.19M | 15.59M | 139.51M | 201.84M | 223.05M | 134.16M |
| Net Income | 3.64M | 2.09M | 99.42M | 143.57M | 164.03M | 102.86M |
Balance Sheet | ||||||
| Total Assets | 269.33M | 284.21M | 309.91M | 316.21M | 398.33M | 276.08M |
| Cash, Cash Equivalents and Short-Term Investments | 162.67M | 162.34M | 150.04M | 87.69M | 109.54M | 174.47M |
| Total Debt | 13.07M | 16.13M | 22.01M | 26.05M | 32.54M | 11.16M |
| Total Liabilities | 53.33M | 74.10M | 108.43M | 161.17M | 195.85M | 118.84M |
| Stockholders Equity | 216.00M | 210.11M | 201.48M | 155.04M | 202.47M | 157.25M |
Cash Flow | ||||||
| Free Cash Flow | -2.42M | 17.02M | 141.17M | 177.89M | 60.34M | 139.31M |
| Operating Cash Flow | 4.15M | 24.48M | 147.66M | 194.57M | 94.55M | 145.20M |
| Investing Cash Flow | -9.91M | -26.52M | -61.05M | -11.41M | -29.06M | -1.28M |
| Financing Cash Flow | -569.00K | -1.51M | -79.79M | -199.58M | -125.13M | -57.14M |
Medifast Technical Analysis
Negative
12.72
Price Trends
13.74
Negative
13.79
Negative
13.99
Negative
Market Momentum
-0.26
Positive
31.52
Neutral
7.03
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MED, the sentiment is Negative. The current price of 12.72 is below the 20-day moving average (MA) of 13.57, below the 50-day MA of 13.74, and below the 200-day MA of 13.99, indicating a bearish trend. The MACD of -0.26 indicates Positive momentum. The RSI at 31.52 is Neutral, neither overbought nor oversold. The STOCH value of 7.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MED.
Medifast Risk Analysis
Medifast disclosed 27 risk factors in its most recent earnings report. Medifast reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Medifast Peers Comparison
UnderperformOutperform
Sector (61)
MED
Medifast
12.87
-4.42
-25.56%
MRM
MEDIROM Healthcare Technologies
2.43
-0.57
-19.00%
WW
WW International, Inc.
29.89
-0.31
-1.03%
Medifast Corporate Events
Executive/Board ChangesShareholder Meetings
Medifast Stockholders Approve Key Proposals at Annual Meeting
Neutral
Jun 20, 2025
On June 18, 2025, Medifast held its Annual Meeting where stockholders voted on several proposals. All directors nominated for re-election were successfully re-elected to the Board. The stockholders also ratified the appointment of RSM US LLP as the Independent Registered Public Accounting Firm for the fiscal year ending December 31, 2025. Additionally, the compensation of the company’s named executive officers was approved on an advisory basis, and the Amended 2012 Plan was also approved.
The most recent analyst rating on (MED) stock is a Hold with a $17.00 price target. To see the full list of analyst forecasts on Medifast stock, see the MED Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.