Medifast (NYSE:MED – Get Free Report) and e.l.f. Beauty (NYSE:ELF – Get Free Report) are both consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.
Risk and Volatility
Medifast has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, e.l.f. Beauty has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500.
Valuation & Earnings
This table compares Medifast and e.l.f. Beauty”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Medifast | $385.79 million | 0.36 | -$18.67 million | ($2.33) | -5.40 |
| e.l.f. Beauty | $1.64 billion | 3.80 | $26.32 million | $1.00 | 105.50 |
e.l.f. Beauty has higher revenue and earnings than Medifast. Medifast is trading at a lower price-to-earnings ratio than e.l.f. Beauty, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
95.5% of Medifast shares are held by institutional investors. Comparatively, 92.4% of e.l.f. Beauty shares are held by institutional investors. 3.7% of Medifast shares are held by insiders. Comparatively, 3.5% of e.l.f. Beauty shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Medifast and e.l.f. Beauty’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Medifast | -8.08% | -6.69% | -5.25% |
| e.l.f. Beauty | 3.38% | 14.07% | 6.81% |
Analyst Ratings
This is a summary of recent recommendations for Medifast and e.l.f. Beauty, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Medifast | 1 | 2 | 0 | 0 | 1.67 |
| e.l.f. Beauty | 1 | 5 | 10 | 2 | 2.72 |
Medifast currently has a consensus price target of $12.00, indicating a potential downside of 4.69%. e.l.f. Beauty has a consensus price target of $92.12, indicating a potential downside of 12.68%. Given Medifast’s higher probable upside, analysts clearly believe Medifast is more favorable than e.l.f. Beauty.
Summary
e.l.f. Beauty beats Medifast on 12 of the 15 factors compared between the two stocks.
About Medifast
Medifast, Inc., through its subsidiaries, engages in the manufacture and sale of weight loss, weight management, and healthy living products in the United States and the Asia-Pacific. It offers bars, puffs, cereal, crunchers, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups under the OPTAVIA, OPTAVIA ACTIVE, and Optimal Health brand names. The company markets its products through point-of-sale transactions, as well as through ecommerce platform. Medifast, Inc. was founded in 1980 and is headquartered in Baltimore, Maryland.
About e.l.f. Beauty
e.l.f. Beauty, Inc. is a holding company, which engages in the provision of inclusive, accessible, clean, vegan and cruelty free cosmetics and skin care products. The company focuses on the e-commerce, national retailers and international business channels. Its brands include elf, elf skin, WELL People and KEYS soulcare. The company was founded in 2004 and is headquartered in Oakland, CA.
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