Wellness company Medifast (NYSE:MED) will be reporting results tomorrow after market hours. Here's what to expect.

Medifast beat analysts' revenue expectations by 3.7% last quarter, reporting revenues of $191 million, down 43.4% year on year. It was a weak quarter for the company, with revenue guidance for next quarter missing analysts' expectations.

Is Medifast a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Medifast's revenue to decline 51.6% year on year to $168.9 million, a further deceleration from the 16.4% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.78 per share.

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they are expecting the business to stay the course heading into earnings. Medifast has a history of exceeding Wall Street's expectations, beating revenue estimates every single time over the past two years by 5.4% on average.

Looking at Medifast's peers in the consumer staples segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Colgate-Palmolive delivered year-on-year revenue growth of 6.2%, beating analysts' expectations by 2.1%, and General Mills reported flat revenue, topping Wall Street's consensus estimates by 2.7%. General Mills's stock price was unchanged following the results.

Read our full analysis of Colgate-Palmolive's results here and General Mills's results here.

Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and while some of the consumer staples stocks have fared somewhat better, they have not been spared, with share price declining 4.3% over the last month. Medifast is down 10.1% during the same time and is heading into earnings with an average analyst price target of $37.5 (compared to share price of $33.71).

Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefitting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.