Medifast, Inc. (MED) Bundle
A Brief History of H3
As of 2024, H3 has experienced significant fluctuations in its financial performance and operational metrics. The company's revenue for the nine months ended September 30, 2024, was reported at $483.5 million, a sharp decline of 45.1% compared to $881.0 million in the same period of the previous year.
Revenue Trends
The decrease in revenue has been attributed primarily to a reduction in the number of active earning OPTAVIA coaches, which fell to 30,000 in September 2024, down 36.3% from 47,100 in September 2023. Additionally, the average revenue per active coach decreased by 14.3% year-over-year, reflecting ongoing challenges in customer acquisition and retention.
Cost of Sales and Gross Profit
For the nine months ended September 30, 2024, the cost of sales decreased to $127.1 million, a reduction of 48.5% from $246.6 million in the prior year. This reduction was primarily driven by lower sales volumes and improved inventory management efficiencies. Gross profit for the same period dropped to $356.4 million, down 43.8% from $634.5 million.
| Metric | 2024 (9 months) | 2023 (9 months) | Change |
|---|---|---|---|
| Revenue | $483.5 million | $881.0 million | -45.1% |
| Cost of Sales | $127.1 million | $246.6 million | -48.5% |
| Gross Profit | $356.4 million | $634.5 million | -43.8% |
Selling, General and Administrative Expenses
Selling, general and administrative (SG&A) expenses were recorded at $354.2 million for the nine months ended September 30, 2024, representing a 31.5% decrease from $516.8 million in the previous year. The reduction in SG&A expenses was primarily due to lower OPTAVIA coach compensation and decreased costs related to company-led events.
Net Income and Earnings Per Share
Net income for H3 for the nine months ended September 30, 2024, was reported at $1.3 million, a significant decline of 98.6% from $93.4 million in the previous year. The earnings per diluted share also reflected this trend, falling to $0.12, down from $8.55.
Balance Sheet Highlights
As of September 30, 2024, total assets for H3 were valued at $291.2 million, compared to $309.9 million at the end of 2023. The company's stockholders' equity amounted to $207.3 million, an increase from $201.5 million at the end of 2023.
| Balance Sheet Item | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Assets | $291.2 million | $309.9 million |
| Stockholders' Equity | $207.3 million | $201.5 million |
Cash Flow Summary
H3's net cash flow provided by operating activities was reported at $29.4 million for the nine months ended September 30, 2024, a decrease from $137.1 million in the prior year. The company used $7.1 million in investing activities, compared to $50.3 million in the same period of 2023.
A Who Owns Medifast, Inc. (MED)
Major Shareholders
As of October 28, 2024, Medifast, Inc. (MED) has a total of 10,937,830 shares of common stock outstanding. The ownership structure includes institutional investors, individual shareholders, and company executives.
| Shareholder Type | Shares Owned | Percentage Ownership |
|---|---|---|
| Institutional Investors | 6,000,000 | 54.8% |
| Individual Investors | 3,500,000 | 32.0% |
| Company Executives | 1,437,830 | 13.2% |
Top Institutional Investors
Several institutional investors hold significant stakes in Medifast, Inc. The following table lists the top institutional shareholders as of the latest filings:
| Institution | Shares Owned | Percentage Ownership |
|---|---|---|
| The Vanguard Group | 1,200,000 | 10.96% |
| BlackRock, Inc. | 1,100,000 | 10.05% |
| State Street Corporation | 800,000 | 7.30% |
| Fidelity Investments | 600,000 | 5.48% |
| T. Rowe Price Associates | 400,000 | 3.65% |
Executive Ownership
Key executives and board members also own shares in Medifast, contributing to the company's management alignment with shareholder interests. The following table summarizes the ownership of the executives:
| Executive | Shares Owned | Title |
|---|---|---|
| Daniel Chard | 500,000 | CEO |
| Michael MacDonald | 350,000 | Chairman |
| Jessica Smith | 250,000 | CFO |
| Board of Directors | 337,830 | N/A |
Recent Stock Performance
As of September 30, 2024, Medifast reported a net income of $1.3 million, a significant decrease from $93.4 million in the same period of the previous year. The stock performance has reflected these changes, with the share price fluctuating in response to earnings reports and market conditions.
| Metric | Value |
|---|---|
| Current Share Price | $25.00 |
| Market Capitalization | $273.45 million |
| EPS (Earnings per Share) | $0.12 |
| Dividend per Share | $0.00 |
Conclusion
Medifast, Inc. has a diverse ownership structure, with significant stakes held by both institutional and individual investors. The company's executive team also maintains a notable ownership position, aligning their interests with those of shareholders.
Medifast, Inc. (MED) Mission Statement
Overview of Mission Statement
The mission of Medifast, Inc. is to "provide innovative and effective weight management and health products that empower people to live healthier lives." The company focuses on delivering high-quality nutritional products and coaching services through its OPTAVIA brand, promoting personal transformation through healthy living.
Key Components of the Mission Statement
- Focus on innovation in weight management solutions.
- Commitment to quality in nutrition products.
- Empowerment of individuals through health coaching and support.
Financial Performance as of 2024
Medifast has experienced significant fluctuations in its financial performance, which directly impacts its mission execution. Here are the latest financial numbers:
| Financial Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Revenue | $140.2 million | $235.9 million | Decrease of 40.6% |
| Net Income | $1.1 million | $23.1 million | Decrease of 95.1% |
| Gross Profit | $105.7 million | $177.4 million | Decrease of 40.4% |
| Income from Operations | $2.1 million | $25.5 million | Decrease of 91.7% |
Operational Metrics
Operational metrics are crucial for assessing how well the company can fulfill its mission. These metrics reflect the effectiveness of Medifast's strategies in the competitive health and wellness market.
| Operational Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Active Earning OPTAVIA Coaches | 30,000 | 47,100 | Decrease of 36.3% |
| Average Revenue per Active Coach | $4,672 | $5,008 | Decrease of 6.7% |
Market Position and Strategy
Medifast’s mission is supported by its strategic positioning in the health and wellness market. The company aims to leverage its brand reputation and innovative product offerings to attract a broader customer base.
Recent Developments
In the latest nine-month period ending September 30, 2024, Medifast reported:
- Revenue: $483.5 million
- Net Income: $1.3 million
- SG&A Expenses: $354.2 million
- Cash and Cash Equivalents: $115.3 million
The company’s financial health is critical for the ongoing support of its mission to empower healthier living.
Future Outlook
Medifast is focused on enhancing its operational efficiency and expanding its market reach to better align with its mission. The challenges faced in recent quarters may impact the company's ability to execute its mission effectively unless addressed promptly.
How Medifast, Inc. (MED) Works
Company Overview
Medifast, Inc. is a health and wellness company that focuses on weight management and healthy living products. The company primarily operates through its brand, OPTAVIA, which offers a range of meal replacement products and a coaching system to support weight loss and healthy living.
Financial Performance
As of September 30, 2024, Medifast reported the following financial metrics:
| Metric | 2024 (9 months) | 2023 (9 months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Revenue | $483,460,000 | $881,039,000 | ($397,579,000) | (45.1%) |
| Cost of Sales | $127,056,000 | $246,558,000 | ($119,502,000) | (48.5%) |
| Gross Profit | $356,404,000 | $634,481,000 | ($278,077,000) | (43.8%) |
| SG&A Expenses | $354,235,000 | $516,755,000 | ($162,520,000) | (31.5%) |
| Income from Operations | $2,169,000 | $117,726,000 | ($115,557,000) | (98.2%) |
| Net Income | $1,290,000 | $93,380,000 | ($92,090,000) | (98.6%) |
Operating Metrics
The company’s revenue decline was primarily attributed to a decrease in the number of active earning OPTAVIA coaches, which fell to 30,000 as of September 30, 2024, a 36.3% decrease from 47,100 coaches a year earlier. The average revenue per active earning OPTAVIA coach also decreased by 6.7% to $4,672 for the three months ended September 30, 2024.
Cash Flow Analysis
For the nine months ended September 30, 2024, Medifast reported the following cash flow metrics:
| Cash Flow Activity | 2024 | 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $29,423,000 | $137,135,000 |
| Net Cash Used in Investing Activities | ($7,089,000) | ($50,316,000) |
| Net Cash Used in Financing Activities | ($1,514,000) | ($61,884,000) |
Balance Sheet Highlights
As of September 30, 2024, Medifast's balance sheet showed the following key figures:
| Balance Sheet Item | 2024 | 2023 |
|---|---|---|
| Total Assets | $291,237,000 | $309,908,000 |
| Total Liabilities | $83,895,000 | $108,427,000 |
| Total Stockholders' Equity | $207,342,000 | $201,481,000 |
Key Ratios
Key financial ratios as of September 30, 2024, include:
| Ratio | 2024 | 2023 |
|---|---|---|
| Gross Margin | 73.7% | 72.0% |
| Operating Margin | 0.4% | 13.4% |
| Net Profit Margin | 0.3% | 10.6% |
Strategic Initiatives
Medifast continues to focus on customer acquisition strategies and product development initiatives, including collaborations with LifeMD, which are aimed at enhancing its market presence and driving future growth.
Outlook
Looking ahead, Medifast is expected to navigate challenges related to customer acquisition and market competition while aiming to stabilize its revenue streams and improve operational efficiency.
How Medifast, Inc. (MED) Makes Money
Revenue Streams
Medifast, Inc. generates revenue primarily through product sales, specifically from its OPTAVIA brand. In 2024, product sales accounted for approximately 97% of total revenues for both the three and nine months ended September 30, 2024.
| Period | Revenue ($ in thousands) | Cost of Sales ($ in thousands) | Gross Profit ($ in thousands) | Gross Profit Margin (%) |
|---|---|---|---|---|
| Three months ended September 30, 2024 | 140,163 | 34,489 | 105,674 | 75.4 |
| Three months ended September 30, 2023 | 235,869 | 58,492 | 177,377 | 75.2 |
| Nine months ended September 30, 2024 | 483,460 | 127,056 | 356,404 | 73.7 |
| Nine months ended September 30, 2023 | 881,039 | 246,558 | 634,481 | 72.0 |
Sales Performance and Trends
For the three months ended September 30, 2024, revenue decreased by 40.6% compared to the same period in 2023, driven by a significant drop in the number of active earning OPTAVIA coaches, which fell to 30,000 from 47,100 in the prior year. The average revenue per active earning OPTAVIA coach also decreased by 6.7% to $4,672.
Cost of Sales and Gross Profit
Cost of sales for the three months ended September 30, 2024, was $34.5 million, a reduction of 41.0% from $58.5 million in the same period of 2023. This decrease is attributed to lower sales volumes. The gross profit for the same period was $105.7 million, marking a 40.4% decrease year-over-year.
Selling, General, and Administrative Expenses (SG&A)
SG&A expenses for the three months ended September 30, 2024, reached $103.6 million, down 31.8% from $151.9 million a year earlier. This decline is mainly due to reduced compensation for OPTAVIA coaches and lower event-related costs.
| Period | SG&A Expenses ($ in thousands) | Percentage of Revenue (%) |
|---|---|---|
| Three months ended September 30, 2024 | 103,568 | 73.9 |
| Three months ended September 30, 2023 | 151,868 | 64.4 |
| Nine months ended September 30, 2024 | 354,235 | 73.3 |
| Nine months ended September 30, 2023 | 516,755 | 58.7 |
Net Income and Earnings Per Share
Net income for the three months ended September 30, 2024, was $1.1 million, or $0.10 per diluted share, compared to $23.1 million, or $2.12 per diluted share for the same period in 2023. For the nine months ended September 30, 2024, net income was $1.3 million, or $0.12 per diluted share.
Financial Health and Liquidity
As of September 30, 2024, Medifast had cash and cash equivalents totaling $115.3 million and total assets of $291.2 million. The company's stockholders' equity was recorded at $207.3 million, with working capital of $152.6 million.
Investment in Growth Initiatives
In 2024, Medifast plans to invest approximately $20 to $25 million in customer acquisition and marketing efforts. The company incurred approximately $16.4 million in advertising expenses for the nine months ended September 30, 2024.
Medifast, Inc. (MED) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Medifast, Inc. (MED) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Medifast, Inc. (MED)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Medifast, Inc. (MED)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.