Market Overview

A Preview Of Medifast's Earnings

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Medifast (NYSE: MED) releases its next round of earnings this Monday, November 02. Get the latest predictions in Benzinga's essential guide to the company's Q3 earnings report.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Medifast EPS is expected to be around $2.46, according to sell-side analysts. Sales will likely be near $240.62 million. Medifast reported a profit of $1.32 per share when it published results during the same quarter last year. Sales in that period totaled $190.06 million.

Why Analyst Estimates And Earnings Surprises Are Important

Wall Street analysts who study this company will publish analyst estimates of revenue and EPS. The averages of all analyst EPS and revenue estimates are called the "consensus estimates"; these consensus estimates can have a significant effect on a company's performance during an earnings release. When a company posts earnings or revenue above or below a consensus estimate, it has posted an "earnings surprise", which can really move a stock depending on the difference between actual and estimated values.

If the company were to match the consensus estimate when it reports Monday, EPS would be up 86.36%. Sales would be up 26.6% from the year-ago period. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Quarter Q2 2020 Q1 2020 Q4 2020 Q3 2019
EPS Estimate 1.83 1.33 1.07 1.34
EPS Actual 1.96 1.93 1.19 1.32
Revenue Estimate 191.76 M 165.71 M 161.69 M 195.17 M
Revenue Actual 220.00 M 178.46 M 170.63 M 190.06 M

Stock Performance

Shares of Medifast were trading at $150.96 as of October 29. Over the last 52-week period, shares are up 33.48%. Given that these returns are generally positive, long-term shareholders can be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Medifast is scheduled to hold the call at 16:30:00 ET and can be accessed here.

 

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Posted-In: Earnings