Medifast Inc

MED

Miscellaneous Food Preparations & Kindred Products

Mkt Cap

$712M

PE

5.94

Debt

Cash

$112.8M

EV

FCF

$174.3M

Market Cap

$712M

P/E Ratio

5.94

Debt

Cash

$112.8M

EV

FCF

$174.3M

Medifast, 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 based in Baltimore, Maryland.

Sector

10-Q
9/30/23
10-Q
6/30/23
10-Q
3/31/23
10-K
12/31/22
10-Q
9/30/22
10-Q
6/30/22
10-Q
3/31/22
10-K
12/31/21
10-Q
9/30/21
10-Q
6/30/21
10-Q
3/31/21
10-K
12/31/20
10-Q
9/30/20
10-Q
6/30/20
10-Q
3/31/20
10-K
12/31/19
10-Q
9/30/19
10-Q
6/30/19
10-Q
3/31/19
10-K
12/31/18
10-Q
9/30/18
10-Q
6/30/18
10-Q
3/31/18
10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Medifast Inc

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$174.3M	$223.3M	$280.3M	$344.6M	$415M	$489M	$563.7M	$635.2M	$699.6M	$752.6M	$790.2M	$7.902B
DCF		$194.1M	$211.9M	$226.6M	$237.3M	$243.1M	$243.7M	$238.8M	$228.7M	$213.9M	$195.3M	$1.953B
Value	$4.187B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 40%

Earnings Stability 94%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	12-2014	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	TTM
Net Margin	4.6%	7.4%	6.5%	9.2%	11%	11%	11%	11%	9%	9.8%
ROA	28%	26%	23%	28%	42%	48%	49%	54%	58%	47%
ROE	16%	23%	19%	26%	51%	74%	65%	81%	93%	62%

What is the average Net Margin?

The average Net Margin over the past 5 years is +10.33%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.06%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +46.67%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is +5.38%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +65%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is +11.89%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Data are missing

The Graham’s stability indicate reliability of earnings, and consideration about the future are more dependable.

Years	12-2014	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	TTM
Debt FCF	-	-	-	-	-	-	-	-	-	-
Debt Equity	-	-	-	-	-	-	-	-	-	-
MIN
Graham Stability	-	-	94%	100%	100%	100%	100%	100%	100%	94%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is -.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -.

What is the Graham’s Stability?

Graham’s Stability measure stands at 0.94.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has been increasing in past years.

Years	12-2015	12-2017	12-2019	12-2021	Trend
Revenue	29%	40%	31%	4.8%	6.6%
Net Income	32%	39%	23%	-12%	3.7%
Stockholders Equity	8.3%	7.4%	14%	-23%	1.7%
FCF	29%	35%	34%	190%	13%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +39.6%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +6.59%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +38.95%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +3.71%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +7.38%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +1.69%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +34.78%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +13%.