Head to Head Survey: Nu Skin Enterprises (NYSE:NUS) vs. Medifast (NYSE:MED)

Nu Skin Enterprises (NYSE:NUS) and Medifast (NYSE:MED) are both small-cap consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitability, dividends, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Nu Skin Enterprises and Medifast, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nu Skin Enterprises	1	1	0	0	1.50
Medifast	1	2	0	0	1.67

Medifast has a consensus price target of $12.00, suggesting a potential upside of 1.95%. Given Medifast’s stronger consensus rating and higher probable upside, analysts clearly believe Medifast is more favorable than Nu Skin Enterprises.

Risk and Volatility

Nu Skin Enterprises has a beta of 0.98, indicating that its share price is 2% less volatile than the S&P 500. Comparatively, Medifast has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.

Earnings and Valuation

This table compares Nu Skin Enterprises and Medifast”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nu Skin Enterprises	$1.49 billion	0.16	$160.20 million	($4.47)	-1.11
Medifast	$316.93 million	0.42	-$18.67 million	($2.33)	-5.05

Nu Skin Enterprises has higher revenue and earnings than Medifast. Medifast is trading at a lower price-to-earnings ratio than Nu Skin Enterprises, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nu Skin Enterprises and Medifast’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nu Skin Enterprises	-15.73%	6.05%	3.45%
Medifast	-8.08%	-6.69%	-5.25%

Institutional and Insider Ownership

82.8% of Nu Skin Enterprises shares are owned by institutional investors. Comparatively, 95.5% of Medifast shares are owned by institutional investors. 2.8% of Nu Skin Enterprises shares are owned by insiders. Comparatively, 3.7% of Medifast shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

Nu Skin Enterprises pays an annual dividend of $0.24 per share and has a dividend yield of 4.9%. Medifast pays an annual dividend of $6.60 per share and has a dividend yield of 56.1%. Nu Skin Enterprises pays out -5.4% of its earnings in the form of a dividend. Medifast pays out -283.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Medifast is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Medifast beats Nu Skin Enterprises on 9 of the 15 factors compared between the two stocks.

About Nu Skin Enterprises

Nu Skin Enterprises, Inc., together with its subsidiaries, engages in the development and distribution of various beauty and wellness products worldwide. It offers skin care devices, cosmetics, and other personal care products, including ageLOC LumiSpa and ageLOC LumiSpa iO; and nutricentials skin care products. The company also provides wellness products, such as LifePak nutritional supplements, ageLOC TR90 weight management system, and Beauty Focus Collagen+. In addition, it is involved in the research and product development of skin care products and nutritional supplements. The company sells its products under the Nu Skin, Pharmanex, and ageLOC brands through retail stores, website, digital platforms, and independent direct sellers and marketers, as well as a service center. Nu Skin Enterprises, Inc. was founded in 1984 and is headquartered in Provo, Utah.

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.