Shares of Medifast (MED) Fall as Barron's Weighs In
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Shares of Medifast (NYSE: MED) have fallen 50 percent over the past twelve months and are trading down over 3 percent on the day as Barron's suggests it could fall another 20 percent or more in 2012.
The article notes MED has been losing its market share and investor interest to Weight Watchers International (NYSE: WTW) which grew sales by 26 percent over 2011. Shares of WTW are up 60 percent over the last twelve months and are up 25 percent over the past week after companies began encouraging employees to join.
The company has been struggling to compete with weight loss programs which offer users healthy fresh options instead of pre-packaged frozen meals at a value price. The loss in market share has resulted in two quarters of missed earnings and sales expectations during 2011. The growing negative sentiment around the company has began to encourage people to not to join. Barron's believes the Street's earnings consensus for fiscal 2012 of $1.60 per share may be overly optimistic given the company's current business trends.
Medifast investors should take Barron's recommendations on the shares to heart as the paper has an impressive track record when forecasting the stock's movements. Some analysts anticipate shares will fall as low as the mid single digit level.
The article notes MED has been losing its market share and investor interest to Weight Watchers International (NYSE: WTW) which grew sales by 26 percent over 2011. Shares of WTW are up 60 percent over the last twelve months and are up 25 percent over the past week after companies began encouraging employees to join.
The company has been struggling to compete with weight loss programs which offer users healthy fresh options instead of pre-packaged frozen meals at a value price. The loss in market share has resulted in two quarters of missed earnings and sales expectations during 2011. The growing negative sentiment around the company has began to encourage people to not to join. Barron's believes the Street's earnings consensus for fiscal 2012 of $1.60 per share may be overly optimistic given the company's current business trends.
Medifast investors should take Barron's recommendations on the shares to heart as the paper has an impressive track record when forecasting the stock's movements. Some analysts anticipate shares will fall as low as the mid single digit level.
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