Auriga Maintains a 'Buy' on Medifast (MED); Q4 Preview
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Price: $11.95 +2.84%
Rating Summary:
4 Buy, 9 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
4 Buy, 9 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Auriga maintains a 'Buy' on Medifast (NYSE: MED) price target of $26.00.
Auriga analyst said, "Medifast is scheduled to report its 4Q11 and FY11 results on Tuesday, but like its commercial weight loss peers, we expect much of the focus to revolve around the company's progress in the seasonally important 1Q, especially in regards to coach growth in its Take Shape for Life business. While we expect the company to report higher earnings and EPS in the quarter, we believe much of the investor concern is in regards to whether the Take Shape for Life unit is growing again, including increased coaches as well as sustaining its average revenue per coach. In addition, we expect the weight control center expansion to add to revenue in 2012 and that new center earnings should improve as these sites mature."
"We continue to believe that Medifast shares, which trade below 4x our FY12 EV/EVITDA estimate, remain cheap and that the company has the potential for significant growth as it expands throughout the US. In addition, Medifast should continue to generate free cash flow and has a clean balance sheet with net cash of about $32 million."
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 $16.17 yesterday.
Auriga analyst said, "Medifast is scheduled to report its 4Q11 and FY11 results on Tuesday, but like its commercial weight loss peers, we expect much of the focus to revolve around the company's progress in the seasonally important 1Q, especially in regards to coach growth in its Take Shape for Life business. While we expect the company to report higher earnings and EPS in the quarter, we believe much of the investor concern is in regards to whether the Take Shape for Life unit is growing again, including increased coaches as well as sustaining its average revenue per coach. In addition, we expect the weight control center expansion to add to revenue in 2012 and that new center earnings should improve as these sites mature."
"We continue to believe that Medifast shares, which trade below 4x our FY12 EV/EVITDA estimate, remain cheap and that the company has the potential for significant growth as it expands throughout the US. In addition, Medifast should continue to generate free cash flow and has a clean balance sheet with net cash of about $32 million."
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 $16.17 yesterday.
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