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What: Shares of Medifast Inc. (NYSE:MED) were looking healthier today, gaining as much as 10% after reporting fourth-quarter earnings last night and announcing an expansion into Canada.

So what: The weight-loss management specialist said that revenue declined 7% to $77.3 million, worse than estimates, though earnings of $0.39 per share topped expectations at $0.36. CEO Michael MacDonald noted that the company improved operating margin by 480 points in the quarter, helping it to nearly double operating income to $7.0 million. Separately, the company announced it would expand into Canada in the first quarter, beginning by selling through its e-commerce site. 

Now what: While the Canadian expansion will grow Medifast's addressable market by 30 million consumers, the company's guidance was still light for the coming year. Management said it expects revenue of $340 million to $380 million, against estimates of $373 million, and EPS of $1.80-$1.90, below the consensus at $1.93. The improvement in operating margin may be encouraging, but given the flat revenue guidance and downside EPS outlook, today's jump looks exaggerated. 

Jeremy Bowman and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.