What Happened?
Shares of telehealth company Hims & Hers Health (NYSE: HIMS) jumped 3.9% in the morning session after investors looked past a recent insider stock sale and focused on the company's strong growth outlook.
The move came after the stock fell about 15% during the previous trading session. That decline followed the disclosure that CEO Andrew Dudum had sold roughly $11 million worth of company stock, though the transaction was reportedly part of a pre-set investment plan. The rebound suggested investor attention shifted to the company's bright financial forecasts. For the current quarter, estimates pointed to a 45.3% year-over-year increase in sales to $583.51 million. Additionally, earnings were expected to see a significant jump, with projections showing a 50% rise per share compared to the previous year. This positive financial outlook appeared to overshadow concerns stemming from the executive's stock sale.
After the initial pop the shares cooled down to $51.32, up 3.1% from previous close.
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What Is The Market Telling Us
Hims & Hers Health’s shares are extremely volatile and have had 101 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock dropped 6.8% on the news that a Bank of America analyst maintained a Sell rating on the stock, citing multiple concerns about the company's near-term performance. The drop reversed some of the strong gains from the previous trading session, which occurred after the company announced a new care program for menopause. The analyst expressed concern over the company's ability to meet third-quarter sales expectations. The report highlighted weaker order growth, pointing to data that showed a 16% year-over-year decline in orders during September. The analyst also noted potential pressure on margins from rising customer acquisition costs, increased competition, and recent FDA reforms. The bank kept its price target at $28, which implied a significant potential downside from the stock's recent price levels.
Hims & Hers Health is up 104% since the beginning of the year, but at $51.32 per share, it is still trading 25.3% below its 52-week high of $68.74 from February 2025. Investors who bought $1,000 worth of Hims & Hers Health’s shares 5 years ago would now be looking at an investment worth $4,965.
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