Hims & Hers stock analysis: High-flyer or just a volatile bet?

Table of Contents

1. Short profile of Hims and Hers

2. What is Hims and Hers doing to continue to grow?
3. Hims & Hers and GLP1: The great unknown
4. How did Hims and Hers perform in the last quarter?
5. Who runs Hims and Hers?
6. And what do the key figures of Hims and Hers say?
7. Conclusion on Hims and Hers

Almost exactly three years ago, we published our first analysis of Hims and Hers (US4330001060) on our blog. At the time, we described the company as a “telehealth platform in the style of Teladoc (ISIN: US87918A1051) or Amwell”. However, a lot has changed since then. While Amwell is now only known to a few investors and Teladoc, as the former market leader, has also suffered a severe crash, Hims has been able to multiply its stock price. Overall, the stock price has increased more than eightfold in the three years since our first article.

Source: StocksGuide

The stock price performance was particularly “wild” in the first three months of 2025. Currently, the stock price is up almost 50% since the beginning of the calendar year – an excellent performance given the negative performance of the US indices this year.

However, a closer look at the Hims and Hers chart shows that the stock has almost halved again since the high of almost $70 on February 19:

Source: stocksguide

The stock remains a top performer based on HGI criteria. This is reason enough for a comprehensive update of our original analysis of Hims and Hers. In the following article, we will take a closer look at how the company has developed over the last three years, why it has experienced a strong increase in the last few months followed by even stronger turbulence, and, of course, what we can expect from the stock in the future.

Short profile of Hims and Hers

The business model of Hims and Hers can be summarized quite quickly. The company sees itself as a healthcare provider. Hims offers digital video consultations with doctors and provides an innovative platform for this. The company focuses on diseases or areas where a personal conversation could be uncomfortable for those affected. This is precisely where Hims and Hers comes in. The company specializes in sexual health, hair loss, dermatology, and mental health. However, Hims and Hers is not just a service provider for video consultations. The company stores patient data digitally on request and has developed a health platform that can be used to suggest treatment methods with the help of doctors.

It is crucial to note that Hims and Hers is only the platform operator due to legal regulations in the USA (“Corporate Practice of Medicine”).

These regulations are intended to prevent commercial interests from influencing medical decision-making and ensure that patient care is the primary focus. Hims & Hers thus acts only as a facilitator of medical services, without having any direct influence on the medical decisions of doctors. The doctors, who remain responsible for prescribing and providing advice, are therefore not employed by Hims and Hers, but by so-called “Affiliated Medical Groups”. Hims and Hers receives a fixed fee for its services from these groups. In addition to providing the platform, these services also include data storage, the use of artificial intelligence, digital billing and much more.

The services provided by Hims and Hers focus to a large extent on chronic illnesses. For this reason, Hims also offers a wide range of prescription drugs from its own online store. In addition, you can also buy dietary supplements such as vitamins. The products are partly from the Hims and Hers own brand, partly also from external suppliers. Hims and Hers offers most of its services via a subscription model. This ensures a continuous stream of revenue for the company.

What is Hims and Hers doing to continue to grow?

In recent years, Hims and Hers has left a number of former competitors far behind. Hims is also significantly increasing its market share compared to the current competition, as can be seen in the following chart from the presentation of the figures for the 4th quarter:

Source: Hims & Hers Q4

Meanwhile, Him's market share is over 47%. This market share calculation is based on specially selected competitors and should therefore be treated with caution.

In order to further expand its market stock, Hims and Hers has also significantly expanded its range in recent years through several acquisitions. Last year alone, Hims took over two factories for the production of pharmaceuticals. One of them is specifically geared towards so-called compounding, which Hims and Hers is increasingly integrating into its business model. “Compounding refers to the individual production or packaging of pharmaceuticals according to special recipes or patient needs. It involves the preparation of pharmaceuticals that are not available on the market as finished standard products, but are instead manufactured specifically for the patient in question. The measures for individualizing the medication to optimally match the patient's needs include variations in dosage and an adjustment of the composition. By the end of the 2024 fiscal year, 55 percent of all returning users of the Hims platform had already opted for this personalized treatment option in the subscription model.

At the same time, Hims has recently started to expand into the field of diagnostics and plans to include this in its portfolio of services in 2025, in order to further strengthen the area of personalized medicine. For example, the company wants to use diagnostics to determine vitamin deficiencies and expand into other chronic diseases, according to Hims. Hims cites menopause support, testosterone deficiency and related problems, and sleep disorders as target areas. Currently, Hims and Hers offers over 300 individualized treatment options here, but expects to be able to increase this number to over 1,000 in the next few years as a result of the measures.

At the same time, Hims is investing heavily in artificial intelligence. At the end of 2023, MedMatch was introduced, a machine learning program that uses anonymized data points from millions of customers to identify potential treatment methods in real time. Initially, the model was introduced for mental health issues, but it has since been extended to other health areas.

In addition, Hims offers its customers chatbots that provide more detailed information on treatment options, offer support for mental health issues and at the same time provide personalized training and nutrition plans. In this way, Hims aims to attract more customers in the future.

Hims & Hers and GLP1: The great unknown

Probably the greatest potential for Hims, but also the greatest risk, lies in another area: weight reduction. GLP-1 (Glucagon-like Peptide-1) is a naturally occurring hormone in the body that plays an important role in regulating blood sugar levels, among other things. It is produced in the intestines and promotes a feeling of satiety. In recent years, Novo-Nordisk and Eli Lilly have succeeded in triggering a stock market hype around the topic of weight loss by producing semaglutide, a chemical agent that mimics the properties of GLP-1. Obesity is one of the biggest health issues of our time – and the so-called “slimness injections” have sparked great enthusiasm among both those affected and investors.

Due to the high demand from the healthcare sector, the US Food and Drug Administration has declared a shortage of semaglutide-based drugs. This means that as long as companies with patents on the products cannot meet demand, other companies in the same industry are allowed to produce similar drugs. Hims did just that at the beginning of 2024, together with partners, and from May onwards offered personalized syringes based on the Novo Nordisk drug at a significantly lower price and also on a subscription basis. The company knew how to capitalize on its popularity and even aired a controversial commercial during the Super Bowl, for which Hims had to fear political consequences in the meantime.

However, on February 21, 2025, the FDA declared the shortage over, which is why the replacement products may no longer be offered. This led to significant price losses for Hims, especially since the company announced in its quarterly figures that in the new year, around one-third of sales are expected to come from the weight loss program offered. In addition, the weight loss program is an important factor for customer loyalty overall, so that the migration of existing customers could also threaten in other categories.

However, Hims is still allowed to sell the stocks that have already been produced. Thus, at least the first quarter is not affected by the ban. At the same time, Hims, which is currently still in talks with the FDA about whether its products can continue to be offered, is trying to compensate for the loss with other products.

On the one hand, Hims could enter into a partnership with Novo Nordisk or Eli Lilly to continue offering their products through the platform. According to Hims CEO Dudum, Hims is open to a partnership, but due to ongoing supply restrictions, the products could not yet be obtained through Hims' partner pharmacies, at least not at the present time. In addition, such a partnership would lead to significantly higher costs for Hims customers and probably also to lower margins for the company itself.

Hims still has the option of offering its oral medications in pill form, but due to patent protection, these do not contain semaglutide, which is so important for weight loss. Their effectiveness is therefore very limited.

The same applies to the generic drug that Hims will launch in the course of the year. It contains the active ingredient “liraglutide”, which is no longer protected by a patent, but is also significantly less effective than the products from Novo Nordisk and Eli Lilly.

Accordingly, investors are very uncertain, which has led to a decline in the stock price in recent weeks. However, the forecast for 2025, which includes around 1/3 of sales from the weight loss program, was already prepared with the knowledge of the FDA's impending ban. Furthermore, despite the loss of patent protection, Hims will still be able to offer personalized slimming products with the patented active ingredient by means of compounding, as long as these differ significantly from the products of Novo Nordisk and Eli Lilly.

So Hims will not lose all sales from the weight loss program. However, investors are currently very skeptical about the extent to which Hims can compensate for the ban on semaglutide production and what impact this will have on customer loyalty and forecasts for the coming year.

How did Hims and Hers perform in the last quarter?

But let's look at the Q4 figures. Hims was able to increase its revenue by 95% compared to the same quarter last year. Gross profit, negatively impacted by Hims' desire to maximize sales of weight loss products at the expense of margins, according to the quarterly report, still rose by 80%.

In view of the impending production ban on semaglutide products, this was certainly a strategically sensible step to generate cash while simultaneously acquiring as many new customers as possible to the platform. Compared to the same quarter of the previous year, the number of new customers rose by 45%.

In contrast, the operating result (EBIT) rose disproportionately by more than 300% - a sign that Hims is spending less and less of its revenue on marketing and sales costs as a percentage. On a quarterly basis, the figures are as follows:

Source:stocksguide

For the year as a whole, revenue growth of 69% was recorded. This is due to both the above-mentioned increase in new customers and the increase in revenue per customer. In fiscal year 2024, each subscriber spent $64 per month on Hims medications, treatments, and consultations. In the previous year, this figure was just $54, an increase of 19%. It is also astonishing that both sales growth with existing customers and with new customers averages 70% over a five-year period. Hims is therefore impressively adept at attracting new customers to the platform, but also at convincing existing customers to spend more and more with new offers. As in the fourth quarter, gross profit increased disproportionately less than operating income for the year as a whole. The figures for the year as a whole are as follows:

Source:stocksguide

For the full year 2025, Hims expects revenues of $2.3 billion to $2.4 billion, an increase of approximately 60 percent. However, as mentioned, this includes $725 million in revenues from the weight loss program. The company explicitly warns that it is not certain that these revenues can be realized in this way if the FDA ban remains in place. Adjusted EBITDA is expected to increase to between $270 million and $320 million compared to 2024. However, it is often unclear to what extent Hims' EBITDA is adjusted, which is why a direct comparison with the 2024 figures is not possible.

A glance at the quarterly balance sheet shows that Hims has high liquid funds that easily cover all short- and long-term liabilities. Beyond that, the company has few assets, which is only natural given Hims' business model, which relies solely on software for its platform. The second largest balance sheet item on the assets side is therefore intangible assets. These increased slightly again in 2024 as a result of the acquisitions mentioned.

Source:stocksguide

It is also encouraging to see that over the last three years, the number of outstanding Hims stocks has only increased by around 8%. In principle, an increase in the number of stocks is negative because existing stockholders are diluted. An increase of 8% is not insignificant, but it is still within reason when you consider that Hims has often been criticized for this in the past.

Source:stocksguide outstanding stocks chart tool

Who runs Hims and Hers?

Hims and Hers is still run by its founder, Andrew Dudum. He has been managing the company since September 2016 and is thus responsible for the rapid growth of recent years. Prior to that, Dudum worked as a start-up and venture capital investor and thus sat on several supervisory boards of young companies. Yemi Okupe, who was previously CFO of various divisions at Uber, supports him in his work on the board.

Furthermore, with Melissa Baird and Soleil Boughton, the board is very small. This allows management to make decisions quickly. In addition, with two men and two women, the board is very balanced.

And what do the key figures of Hims and Hers say?

The HGI score shows that the company is characterized by high sales growth and low debt. Driven by the sales growth, the Rule of 40 score is also very high at over 80%. Otherwise, the company is not exceptionally highly valued based on EV/Sales at just under 5. Compared to previous years, Hims is valued slightly higher here, as the following chart shows.

Source:stocksguide EV/sales chart

However, Hims has also achieved some milestones in recent years, such as profitability and a positive free cash flow, while maintaining high growth rates. This justifies a premium over previous years, when Hims was still very unprofitable in some cases.

The overall HGI score reads as follows:

Source:stocksguide HGI analysis

This puts Hims among the high-growth top scorers with 17/18 points.

Conclusion on Hims and Hers

Contrary to the expectations of many market participants, Hims has succeeded in recent years in retaining customers on its platform while also acquiring new ones. It has often exceeded forecasts and the feared competition from Amazon and Co. has so far failed to materialize. At the same time, the company is gaining an ever-greater competitive advantage through the large number of its customers and their data, which is difficult for competitors to catch up with. In addition, the company is increasingly able to use its wealth of data for personalized medicine and combination treatments – and all of this conveniently for the user via a personalized app. After the setback, the company is once again attractively valued.

Interestingly, analysts take a more differentiated view and the majority recommend holding the stock. However, it should be noted that analysts often issue their assessments with a certain time lag or on special occasions such as quarterly results. It can therefore be assumed that the hold recommendations date from a time when both the price and the valuation of the hims stock were significantly higher. This is also supported by the analysts' average upside target of just under 40% for the Hims stock price.

Source:analysts rating

Analysts expect Hims to continue to see significant sales growth in the coming years. By 2029, sales are expected to rise to almost 5 billion, which is double the sales Hims predicted for the 2025 financial year.

Source:Sales and Margin forecast

If Hims also manages to increase its free cash flow margin and thus grow its free cash flow disproportionately, there is nothing to prevent the Hims stock price from rising further.