Medifast, Inc - Aggressive Growth

Medifast, Inc. (MED) estimates continue to trend higher following the company's sixth consecutive earnings surprise.

Company Description

Medifast offers weight-loss programs based on clinically proven, portion-controlled meals. The plans offer customers to choose from 70 different meals, which are bought directly from Medifast. Additionally, the company offers coaching and support groups for its dieters

Another Surprise

On Aug 5 Medifast reported its sixth consecutive earnings surprise on a 60% increase in revenue. Sales were up to $66.7 million, from $41.7 million a year ago. Net income almost doubled, to $5.6 million from $3.0 million.

Earnings per shares came out to 38 cents, 18 cents better than last year and 4 cents better than Wall Street expected.

Analyst Revisions

Following the earnings surprise, the Zacks Consensus Estimate for 2010 jumped 13 cents, to $1.44. Next year's forecasts are averaging $1.75, up a dime on the news.

If Medifast can meet these expectations, year-over-year growth rates will be 78% and 21%, respectively. And you won't be overpaying for those rates, as shares are trading with a PEG ratio of just 0.8.

The Chart

The recent estimate revisions are nothing new for MED analysts. You can see below that the full-year estimates have been steadily increasing for more than 2 years.

Read the July 7th Feature Here

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service

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