Medifast Inc (MED) released stellar fourth quarter results on March 15th with revenue coming in at $10.2 million, a whopping 76% increase when compared to fourth quarter 2005 revenue of $5.8 million. The company earned 4 cents per diluted share and this represents their 25th consecutive profitable quarter. Interestingly they also upped their 2006 forecast by about 20% and now expect 2006 revenue to come in between $58 and $60 million. Some other highlights from the fourth quarter conference call are given below.
The stock traded up 16.52% on the day following the release of these results and is now registering gains of over 50% in the SINLetter Model Portfolio. Considering that Medifast earns 30 cents a share in 2006, the forward P/E works out to 27.3 based on the closing price of $8.18 on March 16th. For a company that has such an excellent growth rate it certainly appears to be undervalued.