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On Tuesday, Leerink Partners made an adjustment to the price target for Hims & Hers Health, Inc. (NYSE:HIMS), increasing it to $42.00 from the previous $40.00, while maintaining a Market Perform rating on the company’s shares. The decision followed the company’s second-quarter earnings report, which highlighted several critical developments as Hims & Hers continues to evolve its business strategy.
Leerink Partners analysts pointed out that the earnings report indicated a robust trajectory for Hims & Hers, especially with the ongoing shift towards next-generation GLP-1 driven sales. This shift is occurring in tandem with the company’s partnership with Novo Nordisk (NYSE:NVO), which is expected to complement Hims & Hers’ oral offerings and liraglutide products.
Despite the changing dynamics of the company’s relationship with Wegovy, a weight management drug, Hims & Hers reiterated its weight management guidance. This reiteration was seen as a positive sign, indicating the underlying health and potential of the category. However, Leerink Partners also noted that the revenue share model and the continued provision of personalized semaglutide in certain situations warrant a closer examination to fully understand the company’s multi-year trajectory.
The analyst report also mentioned the uneven performance within the sexual health category, which has traditionally been an important contributor to Hims & Hers’ business. While weight management has been a focal point for the company’s narrative, the sexual health segment’s performance serves as a counterbalance to this focus.
Looking towards the future, Hims & Hers has set ambitious targets for 2030 that suggest a solid growth path. The progress towards these targets is expected to be a key determinant of the company’s ultimate profit streams and valuation. Leerink Partners raised their price target based on the anticipation of higher profitability pull-through, while keeping their target EBITDA multiple for calendar year 2026 unchanged at approximately 24 times.
In summary, while acknowledging the positive trends and the company’s evolution, Leerink Partners reiterated their Market Perform rating. This rating reflects a balance between the positive growth drivers and ongoing questions about the durability of Hims & Hers’ business model.
In other recent news, Hims & Hers Health, Inc. reported a strong first-quarter performance, with revenues exceeding expectations across multiple analyst firms. The company reported revenue of $586 million, surpassing both Morgan Stanley (NYSE:MS)’s and BofA’s projections. Despite this robust performance, the company’s second-quarter revenue guidance of $530-$540 million fell short of market expectations, prompting concerns from analysts like BofA and Truist about the potential impact of broader economic trends and changes in GLP-1 revenue. Needham analysts, however, maintained a Buy rating with a $61 price target, expressing confidence in the company’s long-term growth strategy and financial targets.
Truist Securities, on the other hand, held a Hold rating with a $33 price target, noting mixed financial results and emphasizing the company’s commitment to medical guidelines. Meanwhile, BofA maintained an Underperform rating with a $26 target, focusing on the company’s reaffirmed revenue guidance and the role of new product launches. Leerink Partners maintained a Market Perform rating and a $40 price target, highlighting the company’s partnership with Novo Nordisk and its ambitious long-term growth goals.
Morgan Stanley reiterated its Equalweight rating and $40 target, acknowledging a significant earnings beat and a 50% EBITDA beat for the quarter. Despite some concerns about gross margins and revenue growth moderation, the company remains on track with its expansion into weight loss products and plans to introduce new hormone-related products by year-end. These developments reflect a complex landscape for Hims & Hers as it navigates growth opportunities and market challenges.
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