Medifast, Inc. (MED): fair value, margin of safety and Wheel Score

Is MED undervalued?

At 12.06 (close of 16 Oct 2026), MED trades 73% below the GLS average fair value of 45.12. That average comes from 2 models run on the latest filings, and 2 of them land above the current price. Margins of safety over 30% are the exception rather than the rule across the ~7,400 stocks we value each night, so the number earns Medifast, Inc. the full Value points in the Wheel Score - and a closer look at what the market is pricing in.

Only 2 of the nine models produced a value (DCF, 10 Cap); the others need a dividend, positive free cash flow or positive book value the company does not have yet, so the average rests on a narrow base.

The nightly engine files MED under Speculative / Distressed - negative earnings or a Piotroski score of 3 or less - which caps its Wheel Score at 45 and keeps it out of the Sunday Scan.

Nine valuation models for MED

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

Financial health is weak: MED passes 3 of the nine Piotroski tests. Our screens drop the stock at the health rule; a low score is often the reason a stock looks cheap on the valuation models. The GLS Moat score is low at 2.9 out of 10, which says the ten-year record of revenue, earnings, margins and returns on capital has been inconsistent - growth and shocks rather than steady compounding.

Returns on capital are thin or negative - ROIC -8.7%, ROE -9.4%, ROA -7.3% - with debt at 0.08 times equity and a free-cash-flow yield of 3.0%.

Medifast, Inc. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Optavia 88%, Medifast Direct 8%, Franchise Weight Control Centers 3% (quarter Q4 FY2017).

Institutional ownership scores 10/10, insider activity 9/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 45: Weak

MED scores 45 out of 100 on the Wheel Score, in the Weak band (under 50), capped at 45 because the engine files it as Speculative / Distressed. Value 25/25, Health 7/20, Moat 4/15, Premium 20/20, Stability 6/20. The score is not a judgement on the company; it says the price, quality and premium do not line up for selling puts on it today.

Implied volatility is 52% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is 13,581 contracts across all expiries - enough for the wheel at normal size.

Volume runs at 119k shares a day on a market cap of $135M, with a beta of 0.70 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 6 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

Medifast, Inc. reports earnings on 26 Oct 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

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