Medifast Inc

Company Overview: Medifast, Inc. (NYSE: MED) sells a variety of weight loss, weight management, and healthy living products all based on its own formulas under the OPTAVIA, Optimal Health by Taking Shape for Life, and Flavors of Home brands. The Company’s product line includes approximately 95 consumable options, including, but not limited to, bars, bites, pretzels, puffs, cereal crunch, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups.

As per our previous US Diversified Opportunities Report published on ‘MED’ on 25^th January 2024, Kalkine provided a ‘Buy’ stance on the stock at USD 53.42 based on “decent fundamentals, healthy top-line results, dividend distribution & yield, associated risks and valuation upside” and the stock price has now moved down by ~40.20% since then.

Noted below are the details of support and resistance levels provided in our previous report:

MED’s Daily Chart

In Q4FY23 revenue decreased by 43.4% to USD 191.0 million compared to USD 337.2 million in Q4FY22, mainly due to a decline in the number of active earning OPTAVIA Coaches and lower productivity per coach. The average revenue per active earning OPTAVIA Coach dropped by 16.1% to USD 4,648, primarily influenced by ongoing challenges in customer acquisition, resulting in a total decrease of 32.5% in the number of active earning OPTAVIA Coaches compared to the same period last year. Considering the above-mentioned fundamentals, current trading levels, risks associated, and volatile market conditions on the back of higher interest rates, a ‘Sell’ rating is assigned to the “MED” at the current market price of USD31.94 (as of 11 April 2024, 06:50 am PDT).  

Note: This report may be updated with details around fundamental and technical analysis, price/ chart in due course, as appropriate

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is April 11, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’