What happened?
Shares of wellness company Medifast (NYSE:MED) jumped 6.2% in the afternoon session after the company, in a press release, reported third quarter results, with sales exceeding Wall Street's expectations. Medifast generated adjusted EBITDA excluding interest income of $1.9 million in the quarter ended Sept. 30, compared with $1.7 million a year earlier. Adjusted EBITDA after stripping out that interest income's exclusion was $0.4 million, compared with $0.3 million. Chief Executive Nick Johnson said the Trilivy brand, Reset Fuelings, the new compensation plan, and Coach Hub are now in the market, and that the company is on track to deliver a profit in the fourth quarter. Fourth-quarter revenue is guided to $55 million to $75 million and earnings to breakeven to 25 cents a share. For the full year, revenue is expected at $280 million to $300 million, with a GAAP loss of $1.80 to $2.05 a share and an adjusted loss of 45 cents to 70 cents.
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What is the market telling us
Medifast’s shares are somewhat volatile and have had 10 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 11 months ago when the stock gained 3.6% on the news that reports highlighted a consensus analyst price target suggesting a potential upside of more than 51%. A survey of recent analyst ratings showed a consensus target price for Medifast at $16.50. This price level implied a potential gain of 51.31% for the stock from its trading price at the time of the report. The bullish outlook appeared to have resonated with investors.
Medifast is up 22.7% since the beginning of the year, and at $12.76 per share, it is trading close to its 52-week high of $13.15 from May 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Medifast’s shares 5 years ago would now be looking at only $66.41.
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