Medifast (NYSE:MED) vs. BAB (OTCMKTS:BABB) Head-To-Head Analysis

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

Risk and Volatility

Medifast has a beta of 0.48, meaning that its stock price is 52% less volatile than the S&P 500. Comparatively, BAB has a beta of 0.24, meaning that its stock price is 76% less volatile than the S&P 500.

Valuation and Earnings

This table compares Medifast and BAB”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Medifast	$602.46 million	0.20	$2.09 million	$0.01	1,090.50
BAB	$3.55 million	1.80	$520,000.00	$0.07	12.57

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

Profitability

This table compares Medifast and BAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Medifast	0.06%	-0.89%	-0.69%
BAB	17.00%	16.79%	11.62%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Medifast and BAB, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Medifast	1	1	0	0	1.50
BAB	0	0	0	0	0.00

Medifast presently has a consensus price target of $16.50, indicating a potential upside of 51.31%. Given Medifast’s stronger consensus rating and higher possible upside, analysts clearly believe Medifast is more favorable than BAB.

Institutional and Insider Ownership

95.5% of Medifast shares are held by institutional investors. 2.9% of Medifast shares are held by company insiders. Comparatively, 33.7% of BAB shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Medifast beats BAB on 7 of the 13 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 BAB

BAB, Inc. franchises and licenses bagel and muffin retail units under the Big Apple Bagels (BAB), My Favorite Muffin (MFM), and SweetDuet (SD) trade names in the United States. It's BAB franchised brand includes daily baked bagels, flavored cream cheeses, premium coffees, gourmet bagel sandwiches, and other related products; and MFM brand comprises various freshly baked muffins and coffees, as well as units operating as My Favorite Muffin Your All Day Bakery Café features specialty bagel sandwiches and related products. The company's SD brand includes frozen yogurt products. BAB, Inc. was founded in 1993 and is based in Deerfield, Illinois.