What Happened?
Shares of telehealth company Hims & Hers Health (NYSE: HIMS) jumped 3.4% in the afternoon session after JPMorgan Chase & Co. disclosed in a regulatory filing that it had taken a significant passive stake in the company.
The major financial institution reported owning 17.8 million Class A shares, representing an 8.1% stake in the telehealth provider. According to the filing, the shares were acquired in the ordinary course of business and not with the purpose of changing or influencing the control of the company. Such a large investment by a major institution often signals confidence to the market. The news also arrived as investors awaited the company's third-quarter earnings report. Adding to the positive sentiment, Hims & Hers recently announced plans to expand into the booming weight-loss drug market with its own GLP-1 treatments.
After the initial pop the shares cooled down to $45.28, up 2.8% from previous close.
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What Is The Market Telling Us
Hims & Hers Health’s shares are extremely volatile and have had 99 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 11 days ago when the stock gained 3.9% on the news that 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.
Hims & Hers Health is up 79.7% since the beginning of the year, but at $45.28 per share, it is still trading 34.1% 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 $4,462.
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