LifeMD stock price target lowered to $12 at KeyBanc on elevated costs

Investing.com - KeyBanc lowered its price target on LifeMD Inc (NASDAQ:LFMD) to $12.00 from $14.00 on Wednesday, while maintaining an Overweight rating on the telehealth company’s stock. Currently trading at $6.55, InvestingPro analysis suggests the stock is undervalued, with impressive gross profit margins of 87.6%.

The price target reduction follows LifeMD’s second-quarter earnings miss, which KeyBanc attributed primarily to elevated customer acquisition costs (CAC) in the company’s RexMD business segment. The RexMD unit, which focuses on men’s erectile dysfunction and hair loss treatments, represents 40-50% of LifeMD’s telehealth revenue. Despite recent challenges, the company maintains strong revenue growth of 37.7% over the last twelve months.

KeyBanc noted that LifeMD is diversifying its RexMD business to better allocate capital in case of future disruptions. The firm also reported that customer acquisition costs are returning to levels seen in late 2024 and early 2025 due to proactive measures taken by the company.

LifeMD also experienced minor headwinds from higher refund rates in its weight management business, which KeyBanc linked to patients seeking cash-price options around $200 monthly instead of paying approximately $500 monthly for branded GLP-1 medications.

Despite these challenges, KeyBanc expects RexMD to return to double-digit growth in the second half of 2025 by scaling several treatment programs, including hormone replacement therapy, peptides, prescription weight management, and personalized treatments for erectile dysfunction and hair loss. InvestingPro subscribers can access 10+ additional investment tips and a comprehensive analysis of LifeMD’s growth potential through the exclusive Pro Research Report.

In other recent news, LifeMD Inc. reported its financial results for the second quarter of 2025, which fell short of analyst expectations. The company announced a larger-than-expected loss per share, alongside a revenue shortfall compared to what analysts had projected. These earnings results were a significant development for investors, as they provide insight into the company’s financial health. The announcement led to a negative reaction in the market. The company’s stock experienced a drop during regular trading hours, though this was not sustained in aftermarket trading. This financial performance is crucial for investors to consider, as it may influence future investment decisions. No upgrades or downgrades from analyst firms were mentioned in connection with these results.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.