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Medifast

MED
26
Specialty Business Services · Consumer Cyclical
Price
$10.26
-0.24 (-2.29%)
Market Cap
$114.1M
Winston Score
26
Winston is worried
Below-average fundamentals — multiple weak pillars.

Share count falling — buybacks

7.0% over 4y

The company has reduced its share count over this period, returning value to shareholders through buybacks.

Diluted shares outstanding: 11.8M (2021) → 11.0M (2025)

Medifast is a US company that makes and sells weight loss and nutrition products. Its main brand is OPTAVIA, which offers meal replacement items like shakes, bars, and "fuelings" — pre-packaged low-calorie foods designed to help people lose weight. The company sells directly to everyday consumers who want a structured diet program.

Medifast makes most of its money through a network of independent coaches — regular people who buy OPTAVIA products themselves and then sell them to friends, family, and clients. This coach-driven sales model keeps traditional advertising costs low but also creates risk, since revenue depends heavily on recruiting and retaining active coaches. The company operates almost entirely in the United States and has a market cap of roughly $100 million, a sharp drop from its peak. The rise of GLP-1 weight loss drugs like Ozempic is a serious threat, as many potential customers may choose medication over meal replacement programs instead.

Winston Score History

Growth Profile

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-34.3% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-171.4% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$0/ year

0.0% of revenue

Below sector average (4%)

Research and development spending

Insider Activity

30.6%ownership

Insiders own a meaningful stake in the company

Cash Runway

5+ years

Quarterly Free Cash Flow

↓ Burn rate worsening

$72M cash & investments at current burn rate

Revenue declining

Medifast's revenue is actually shrinking. In a growth stock, that removes the core investment thesis. The low Winston Score here may be warranted — unless there's a turnaround story.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

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Quality

Gross Margin
68.1%
Premium pricing power — 68.1% gross margin
Operating Margin
-1.4%
Losing money on operations — -1.4%
ROCE
-0.5%
Weak — -0.5% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY
-36.3%
Shrinking sales (-36.3% YoY)
EPS YoY
N/A
Data not available
EPS Consistency
2/8 quarters
Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion
N/A
Data not available
FCF Margin
-0.4%
Burning cash (-0.4%)

Free cash flow is negative. They are burning cash, not generating it.

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Stability

Debt / Equity
0.02
Conservative — low debt load (0.02)
Interest Cover
N/A
Data not available

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Valuation

P/E Ratio (TTM)
N/M
Negative earnings — P/E not meaningful
P/E vs Forward
N/A
not available
Data not available

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Dividends

Not applicable for this business.
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