MEDIFAST INC (MED) research, news, and more from GeoInvesting

Company description

Fri, 13 Mar 2009 04:00:00 GMT

Medifast (NYSE: MED) is the leading easy-to-use, clinically proven portion-controlled weight loss program. Medifast has been recommended by 15,000 physicians and used by over one million customers. Medifast is committed to enriching lives by providing innovative choices for lasting health. Medifast programs have been proven effective through studies by major university teaching hospitals. The company sells its products and programs via four unique distribution channels: 1) the web and national call centers, 2) national network of physicians, 3) medically supervised Medifast Weight Control Centers, and 4) the Take Shape For Life direct-selling division, a network of health coaches. Medifast was founded in 1980 and is located in Owings Mills, Maryland.

Research

Tue, 04 Aug 2009 04:00:00 GMT

New article available for Medifast

Potential Valuation Scenarios

Mon, 03 Aug 2009 04:00:00 GMT

Valuation Scenarios

Coded as a GeoBargain on April 8, 2009 at a price of $4.75

Data Inputs:

Fiscal Year Ends in December

Date	5/8/09	8/3/09
Price	$6.65	$15.90
12 Months Trailing EPS	$0.45	$0.54
Published 2009 Analyst EPS Estimates	$0.58	$0.63
Future EPS Growth Rate Based on Estimates	52.6%	65.8%
Trailing P/E Ratio	14.78	29.44
PEG Ratio (P/E divided by growth rate)	0.28	0.44

Short-Term Valuation Scenarios

Date	5/8/09	8/3/09
Price Based on P/E of 25 on Four Quarters Trailing EPS	$11.25	$13.50
Price Based on P/E of 20 on Four Quarters Trailing EPS	$9.00	$10.80
Price Based on P/E of 15 on 2009 Analyst EPS Estimates	$8.70	$9.45

Long-Term (12 Months Forward) Valuation Scenarios

Date	5/8/09	8/3/09
Price Based on P/E of 25 on 2009 Analyst EPS Estimates	$14.50	$15.75
Price Based on P/E of 20 on 2009 Analyst EPS Estimates	$11.60	$12.60

Peg Ratio Analysis - Common rule of thumb that PEG ratio should be less than 1.0

PEG Ratio Less than 1?

YES

These scenarios are not investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

Financials

Mon, 03 Aug 2009 04:00:00 GMT

2nd QUARTER 2009 vs. 2008 FINANCIAL SNAPSHOT ENDED JUNE

	2nd Quarter 2009	2nd Quarter 2008	Period Change
GAAP Revenue	$40.7	$27.5 million	48%
GAAP EPS	$0.20	$0.11	81.8%
Fully Diluted Shares	15,039,547	13,791,623	9.0%

Source: See Release, July 30, 2009

1st QUARTER 2009 vs. 2008 FINANCIAL SNAPSHOT ENDED MARCH

	1st Quarter 2009	1st Quarter 2008	Period Change
GAAP Revenue	$33.7 million	$25.2 million	34.7%
GAAP EPS	$.17	$.10	70.0%
Fully Diluted Shares	14,494,898	13,799,293	5.0%

Source: See Release, April 22, 2009

FULL YEAR 2008 vs. 2007 FINANCIAL SNAPSHOT ENDED DECEMBER

	Full Year 2008	Full Year 2007	Period Change
GAAP Revenue	$105.4 million	$83.8 million	25.7%
GAAP EPS	$.38	$.28	35.7%
Fully Diluted Shares	14,329,525	13,644,149	5.0%

Source: See Release, March 12, 2009

Potential Valuation Scenarios

Sun, 10 May 2009 04:00:00 GMT

Valuation Scenarios

Data Inputs:

Fiscal Year Ends in December

Date	5/8/09
Price	$6.65
12 Months Trailing EPS	$0.45
Published 2009 Analyst EPS Estimates	$0.58
Future EPS Growth Rate Based on Estimates	65%
Trailing P/E Ratio	14.78
PEG Ratio (P/E divided by growth rate)	0.23

Short-Term Valuation Scenarios

Date	5/8/09
Price Based on P/E of 25 on Four Quarters Trailing EPS	$11.25
Price Based on P/E of 20 on Four Quarters Trailing EPS	$9.00
Price Based on P/E of 15 on 2009 Analyst EPS Estimates	$8.70

Long-Term (12 Months Forward) Valuation Scenarios

Date	5/8/09
Price Based on P/E of 25 on 2009 Analyst EPS Estimates	$14.50
Price Based on P/E of 20 on 2009 Analyst EPS Estimates	$11.60

Peg Ratio Analysis - Common rule of thumb that PEG ratio should be less than 1.0

PEG Ratio Less than 1?

YES

These scenarios are not investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

Research

Wed, 22 Apr 2009 04:00:00 GMT

GeoNuggets® - Quick Check List Highlighting Undiscovered Opportunities

Medifast Inc. (NYSE:MED)

Company Description: The company sells easy-to-use, clinically proven portion-controlled weight loss programvia four unique distribution channels: 1) the web and national call centers, 2) national network of physicians, 3) medically supervised Medifast Weight Control Centers, and 4) the Take Shape For Life direct-selling division, a network of health coaches.

Price (4/22/09): $5.25
Trailing P/E: 13.82

Fiscal Year Ends In December

12 Months trailing EPS: $0.38
2009 Analyst Estimate: $0.52

Reasons for optimism

1. The company meets six out of ten GeoBargain categories.

	Recent 52-week high
	30% EPS growth rate: Analyst Forecast is 37%
	10% revenue growth: Analyst Forecast is 14%
	Strong balance sheet: Debt to Equity Ratio is 11 to 1; Current Ratio is 2.48 to 1; Positive Operating Cash Flow
	Return on Equity (ROE) is at least 15%: 14.23%
	8% pre-tax margins: 7.44%
	Under 50 million shares outstanding, but exceptions to this rule are routinely made: 14.33 Million Diluted Shares
	High insider ownership: 12.94%
	Limited institutional ownership
	P/E Divided by EPS growth rate ( PEG Ratio) less than one: 13.82/37= .37

2. Medifast participates in a favorable growth industry.

3. Since it has its own manufacturing facility, Medifast can benefit from improved margins when compared to competitors who outsource the majority of production.

4. Medifast's multi-level marketing model has some recession resistant qualities, giving individuals the opportunity to supplement their income. In addition, the weekly cost of meals is less expensive when compared to grocery store purchases.

5. Comments in the 2008 fourth quarter press release indicate that the positive 2008 growth trend has continued into the first quarter of 2009.

Special Investment Risk Consideration

Investors should be aware that the Medifast story does not come without controversy, which has put negative pressure on the stock. In particular, an individual has launched a campaign questioning the validity of the company's multi-level marketing business model. Medifast has refuted all claims arising from the campaign. He has also launched similar movements against other multi-level marketing firms. To read more about this situation please visit the company's 2008 10K page 12.

While the GeoTeam® generally avoids controversial situations, the low valuation has prompted us to follow Medifast more closely.

The GeoTeam® will provide expanded details on MED in the near future.

Potential valuation scenarios if the company can achieve its EPS growth goals

Short-Term Potential value based on fully taxed adjusted trailing EPS

P/E 20 * $0.38 = $7.60
P/E 25 * $0.38 = $9.50

Short-term Potential value based on 2009 fully taxed adjusted Implied EPS Guidance

P/E 15 * $0.52 = $7.80

These scenarios are not intended to be investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

Research

Wed, 08 Apr 2009 04:00:00 GMT

MED has been added to the GeoBargain® list. More details to come.