Search Trend Strength Likely to Lead to Medifast (MED) Earnings Outperformance - Jefferies

Jefferies analyst Stephanie Wissink reiterated a Buy rating and $277.00 price target on Medifast (NYSE: MED) after FY21 estimates ~2% on strong alt data that implies the potential for growth above consensus ahead of the sold out annual OPTAVIA convention on 7/31. New Instagram follower growth +100% compares with 2Q20, while Facebook fans grew +61% vs. 2Q20. Historically, end of period FB likes, and end of period IG likes both bore a 99%+ correlation and extrapolating the trendline yields end of period AEC to 57.4K (FB), 57.7K (IG).

The analyst stated "Optavia search trends at all-time highs, 2Q21 +93% Y/Y. Q2 search trends for Optavia were the highest on record, reflecting elevated levels of consumer interest. More general search trends add further conviction; “how to lose weight” and “weight loss” suggest more consistent levels of interest. Assuming the absence of historical operational disturbances, we see potential for continued outperformance through 2H."

For an analyst ratings summary and ratings history on Medifast click here. For more ratings news on Medifast click here.

Shares of Medifast closed at $280.97 yesterday.

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