You’ve probably seen the ads. They are everywhere—Instagram, podcasts, subway walls. Clean fonts, pastel colors, and a promise that sensitive health issues don’t have to be awkward. But for investors, hims and hers stock has become a much more chaotic story than those soothing aesthetics suggest. It’s a battleground between high-growth believers and "compounding" skeptics.
Buying a stock is usually about betting on a company's future cash flows, but with Hims & Hers Health, Inc. (HIMS), you’re basically betting on whether the FDA will keep its hands off a specific loophole.
Honestly, the volatility is enough to give anyone a headache.
One day, the stock is soaring because they’ve launched a generic weight-loss drug. The next, it’s cratering because Eli Lilly or Novo Nordisk decided to drop their prices or ramp up supply. It is a wild ride. If you are looking for a "set it and forget it" investment, this probably isn't the one. But if you want to understand the intersection of retail medicine and the GLP-1 gold rush, you have to look at the numbers and the legal risks.
What Most People Get Wrong About Hims and Hers Stock
A lot of people think Hims is just a middleman for Viagra and Rogaine. That was true five years ago. Now? They are trying to build a "platform." They want to be the front door of healthcare for millennials and Gen Z.
The biggest misconception is that their recent growth is just a fluke. In Q3 2024, the company reported revenue of $401.6 million. That’s a 77% increase year-over-year. That’s not a fluke; it’s a massive scaling operation. However, the catch is how they got there.
A huge chunk of the recent excitement around hims and hers stock comes from their move into compounded GLP-1s. These are the weight-loss injections like semaglutide. Because the name-brand versions (Wegovy and Ozempic) have been on the FDA’s shortage list, Hims is legally allowed to sell "compounded" versions made by specialty pharmacies.
It is a legal grey area that turned into a multi-million dollar revenue stream overnight.
But what happens when the shortage ends? That is the billion-dollar question. Shortages are temporary by definition. If the FDA declares that Tirzepatide or Semaglutide are no longer in "shortage," the legal protection for compounding these specific formulas could vanish. Investors are essentially playing a game of chicken with the FDA and Big Pharma supply chains.
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The Numbers Are Smokin'—But the Risks Are Real
Let's talk about the actual business health. CEO Andrew Dudum has been incredibly aggressive. He’s pushing the company toward a $1.2 billion revenue run rate.
They have over 2 million subscribers.
Think about that. Two million people are paying a recurring fee for hair loss pills, birth control, or weight loss treatments. That is "sticky" revenue. In the world of SaaS (Software as a Service), high retention is king. In "Health-as-a-Service," it’s even better because people don’t usually stop taking their medication once they find something that works.
However, the marketing spend is eye-watering. They spend hundreds of millions of dollars on advertising. If they stop spending, does the growth stop? Some analysts think so. Others argue that as the brand becomes a household name, they can dial back the ads and let the word-of-mouth take over.
- Gross Margins: Usually hover around 70% to 80%. That is incredible for a "healthcare" company.
- Customer Acquisition Cost (CAC): This is the metric to watch. If it starts creeping up, the stock will likely take a hit.
- The "Lilly" Factor: Eli Lilly recently started selling Zepbound vials directly to consumers for a lower price. This was a direct shot across the bow for companies like Hims & Hers.
Why the GLP-1 Pivot Changed Everything
Before the weight-loss craze, hims and hers stock was struggling to find a floor. It was seen as just another "SPAC" that went public during the 2021 mania and then lost its luster.
Then came the "Skinny Shot" era.
By offering compounded GLP-1s at a fraction of the price of the brand-name versions ($199 vs $1,000+), Hims tapped into a vein of desperate demand. People want these drugs, and their insurance companies often won't pay for them. Hims stepped in as the "affordable" alternative.
This move was brilliant but dangerous.
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It brought in a whole new demographic of "Hers" customers. It diversified their revenue away from just "Hims" products like erectile dysfunction medication. But it also put a giant target on their back. Eli Lilly and Novo Nordisk have some of the best lawyers on the planet. They aren't going to let a telehealth startup eat their lunch without a fight. We are already seeing lawsuits flying around the industry regarding "knock-off" versions of these drugs.
The Personalization Play
To defend themselves, Hims is leaning into "personalization." They aren't just selling a pill; they are selling a tailored dosage or a combination of ingredients that you can't get in a standard prescription. This is their "moat." If they can prove that their compounded versions are uniquely better or more convenient for specific patients, they might be able to survive even after the national shortages end.
It's a gamble. A big one.
The Bear Case: Why Some Investors Are Running Away
You can't talk about this stock without mentioning the shorts. Short sellers have been all over Hims. Their argument is simple: the GLP-1 revenue is "low quality" because it's at risk of being regulated out of existence.
They also point to the low barriers to entry.
Anyone with a few million dollars and a network of doctors can start a telehealth site. What makes Hims special? Is it just the branding? In a world where Ro, Sesame, and even Amazon Clinic exist, the competition is fierce. Amazon, in particular, is the "Final Boss" of any retail business. If Amazon Pharmacy decides to get aggressive with pricing, Hims could be in trouble.
And then there’s the "trust" factor. Compounded drugs don't go through the same rigorous FDA approval process as the name brands. If there is even one high-profile case of a patient getting sick from a compounded drug sold through the platform, the PR nightmare would be catastrophic. The stock wouldn't just dip; it would crater.
The Bull Case: The Future of "Frictionless" Medicine
On the flip side, the bulls think Hims is the next great consumer brand. They see it as the "Starbucks of Healthcare."
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The traditional doctor’s visit is broken. It takes weeks to get an appointment, you sit in a waiting room with old magazines, and the bill is a mystery until it shows up in your mail three months later. Hims makes it easy. You chat with a provider on your phone, the meds show up in a discreet box, and the price is transparent.
Gen Z and Millennials love this. They don't want to talk to a receptionist. They want an app.
As long as Hims keeps adding "categories"—like dermatology, mental health, and weight loss—their "Total Addressable Market" (TAM) is basically the entire healthcare system. If they can successfully navigate the GLP-1 transition, they could become a massive, diversified health company that eventually gets acquired by a giant like CVS or UnitedHealth.
What to Watch in 2026 and Beyond
If you are holding hims and hers stock, you need to keep your eyes on the FDA's "Drug Shortages" database. That is your new favorite website.
The moment Tirzepatide comes off that list, the clock starts ticking for Hims.
You also need to watch their "non-GLP-1" growth. Is the core business—hair and sex—still growing? If the weight-loss side of the business is just a "bridge" to fund the expansion of other categories, that’s a great sign. If it’s the only thing keeping the lights on, that’s a red flag.
Watch the margins, too. If they have to keep lowering prices to compete with Eli Lilly, that 80% gross margin will start looking like 50% very quickly.
Next Steps for Investors and Observers
- Check the FDA Shortage List: Regularly monitor the status of Semaglutide and Tirzepatide. This is the single biggest "binary" risk for the stock right now. If the shortage ends, the compounding loophole closes.
- Analyze the "S-Curve" of Subscribers: Look at the quarterly reports to see if subscriber growth is accelerating or plateauing. A slowdown in user acquisition usually precedes a drop in stock price.
- Evaluate Competition Pricing: Keep a close eye on Eli Lilly’s "LillyDirect" and Amazon Clinic. If they continue to drop prices for brand-name drugs, Hims’ "compounded" advantage disappears.
- Listen to Earnings Calls: Pay attention to how management talks about "proprietary formulations." This is their attempt to move away from simple generics into something they can actually patent or protect.
- Assess Your Risk Tolerance: Recognize that this is a "high-beta" stock. It will move much faster and more violently than the S&P 500. Only allocate capital that you are comfortable seeing fluctuate by 10-20% in a single week.
The telehealth landscape is shifting fast. Hims and Hers is no longer just a "lifestyle" brand; it is a pharmaceutical disruptor. Whether it survives the counter-attack from "Big Pharma" will determine if the stock is a multi-bagger or a cautionary tale.