The Rejuvenation of Medifast Inc. (NYSE:MED)

The Rejuvenation of Medifast Inc. (NYSE:MED)

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The Medifast Inc. (MED) shares are trading at higher $131.05 and the avg recommendation for the stock is Moderate Buy. The current analyst price target stands at $88.67.

To add more color to this target, the company’s high over the last year is $130.39 and the low is $49.03. Over the last 52 weeks, MED is up 0.51% while the S&P 500 is up 1.07%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, MED reported a profit of $135.24 million. Medifast Inc. also saw revenues increase to $178.46 million. In addition, MED has free cash flow of $26.44 million as of 03-2020 The company’s EBITDA came in at $25.29 million which compares well with its peers.

MED booked profit margins of 10.40%, its Return on Equity (ROE) is 66.80%, and its Return on Assets is 37.40%. All told, it is clear that, MED needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. MED has a short ratio of 13.43 and outstanding shares of 11.77M.

Company Outlook

MED has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 0.22 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 6.30. Medifast Inc. MED also noted assets of $202.14 million at the end of the last quarter. Investors should also keep an eye on sector updates as MED has historically followed its peers on positive news.

All told, Medifast Inc. MED has strung together solid data and demonstrated underlying fundamentals. At its current valuation, MED represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Medifast Inc. MED is now commanding a market cap of 1.55B and a float of 11.22M. MED is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of MED stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in MED, either long or short, and we have not been compensated for this article.