HIMS Has Been a Roller Coaster Ride. Should Investors Hop On?

• StockStory Top Pick LLY -0.60% MRK -0.08%
• HIMS -6.17% PFE -1.93% ABBV -1.49%

Key Points

• Shares of HIMS have seen gains of 173% and 146% this year, but they’ve also seen massive double-digit corrections after each run-up in price. 

• The company’s management was able to achieve profitability just three years after its IPO.

• Analysts’ forecast an average 12-month price target nearly 25% higher than where the stock is trading today.

• Interested in Hims & Hers Health, Inc.? Here are five stocks we like better.

Most of the health care sector's headlines are dominated by Big Pharma giants. Legacy companies, including AbbVie (NYSE: ABBV), Eli Lilly (NYSE: LLY), Pfizer (NYSE: PFE), and Merck (NYSE: MRK)—and their lineup of game-changing drugs—receive the lion’s share of attention. But one newcomer is making a splash, and investors looking for growth opportunities in the health space should be paying attention.

Founded in November 2017, Hims & Hers Health (NYSE: HIMS) went public in January 2021. By the end of 2024, the consumer-focused health platform was able to post its first year of profitability, with net income of $126 million.

→ Why Home Depot’s Pain Could Be a Long-Term Investor’s Gain

While that figure pales in comparison to mega-cap giants like Pfizer, it demonstrates a level of discipline rarely seen among companies that are less than five years removed from their IPOs. That, combined with operations at the confluence of several high-demand industries, makes Hims & Hers Health an intriguing buy-and-hold prospect.

A Turbulent Year for Shareholders

Fundamentally, the young company’s debt management has been exemplary. That has been accentuated by a nearly 244% increase in net cash from operating activities from 2023 to 2024.

→ 3 Smart Defensive Stocks for an Uneasy Market

When Hims & Hers Health reported Q3 financials on Nov. 3, it missed on earnings by just 3 cents and beat on revenue, with $598.98 million representing a 49.2% year-over-year increase.

In his comments, CEO and cofounder Andrew Dudum highlighted that “At the end of the quarter, subscribers using personalized solutions grew 50% year-over-year, helping drive nearly 50% in year-over-year revenue growth.”

→ 3 Companies to Watch as Natural Gas Stocks Make a Comeback

Most notably, the company’s debt-to-equity ratio of 1.67 and its forward price-to-earnings (P/E) ratio of 52.79—a marked improvement of its trailing 12-month P/E of 67.33—suggests that earnings next year should grow by more than 79% from 29 cents per share to 52 cents per share.

Since 2021, Hims & Hers Health has averaged annual earnings before interest, taxes, depreciation, and amortization (EBITDA) growth of 37.14%, revenue growth of 77.85%, and earnings per share (EPS) growth of 169.63%.

Despite these robust fundamentals, 2025 required a strong stomach for shareholders in HIMS. The stock’s performance has been nothing short of a roller coaster ride this year, featuring both meteoric rises and dramatic crashes in rapid succession.

From Jan 2. to Feb. 19, HIMS gained nearly 173% before giving more than 63% back by April 22. By May 19, it had gained nearly 146% before plunging 36% lower by June 25. At the end of July, it had regained 60%, and at the time of writing, the stock is down another 45% from that high.

HIMS Is at the Center of Multiple High-Growth Industries

Still, since going public, the stock is up almost 139%. Hims & Hers Health has shown exceptionally strong growth while its management has produced balance sheets that are nothing short of admirable. The company’s accessible, direct-to-consumer telehealth model has positioned it at the intersection of multiple high-growth industries.

According to market consultancy firm Grand View Research, the sexual health supplement market is projected to enjoy a compound annual growth rate (CAGR) of 10.4% from 2024 through 2030.

The hair thinning market’s projected CAGR during the same period is 10.85%, while the telehealth market is expected to grow by a CAGR of 24.68%.

Perhaps most notably, Hims & Hers Health also offers compounded GLP-1 injections, which contain the same ingredients as Novo Nordisk’s (NYSE: NVO) Ozempic and Wegovy. The GLP-1 weight loss market during that forecast period is projected to be 18.54%.

Additionally, Dudum noted in the company’s Q3 earnings call that Hims & Hers Health is in ongoing discussions with Novo Nordisk to distribute both injection and oral formulations of Wegovy on the Hims & Hers platform, pending FDA approval.

Here’s What Wall Street Thinks of HIMS

Ten of the 15 analysts covering Hims & Hers Health rate it a Hold, and the stock carries a consensus Reduce rating. Still, 15 analysts’ average 12-month price target is $45.27, which suggests potential upside performance of 24.51%.

However, the current level of short interest may give prospective investors pause. That stands at a significant 37.54% of the company’s float. But for those who are considering HIMS as a long-term investment, institutional ownership—which remains strong at nearly 64%—provides a vote of confidence.

Underscoring the smart money’s bullish stance on Hims & Hers Health, over the past 12 months, 425 institutional buyers have injected $2.31 billion in inflows, compared to just 194 institutional sellers pulling out $1.17 billion.

The article "HIMS Has Been a Roller Coaster Ride. Should Investors Hop On?" was originally published by MarketBeat.