The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Medifast met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share expanded significantly. GAAP earnings per share expanded significantly.
Margins increased across the board.
Medifast chalked up revenue of $83.2 million. The four analysts polled by S&P Capital IQ hoped for net sales of $82.8 million on the same basis. GAAP reported sales were 20% higher than the prior-year quarter's $69.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.28. The five earnings estimates compiled by S&P Capital IQ predicted $0.25 per share. Non-GAAP EPS of $0.28 for Q4 were 180% higher than the prior-year quarter's $0.10 per share. GAAP EPS of $0.13 for Q4 were 63% higher than the prior-year quarter's $0.08 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 75.4%, 20 basis points better than the prior-year quarter. Operating margin was 4.3%, 190 basis points better than the prior-year quarter. Net margin was 2.2%, 50 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $100.6 million. On the bottom line, the average EPS estimate is $0.45.
Next year's average estimate for revenue is $397.3 million. The average EPS estimate is $1.76.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 252 members out of 307 rating the stock outperform, and 55 members rating it underperform. Among 66 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give Medifast a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Medifast is outperform, with an average price target of $34.40.
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