Wall Street has a love-hate relationship with Hims & Hers Health Inc. (HIMS). One week, the stock price of hims is the darling of growth investors, skyrocketing on the back of explosive subscriber numbers. The next, it’s a cautionary tale, tumbling because a regulator in Washington sneezed. If you’ve looked at your portfolio lately, you know the feeling. It's a rollercoaster.
Right now, the ticker is hovering around the $32.19 mark. It’s a far cry from the $72 highs we saw some months back, but it's also miles above the $20 basement where it spent so much of its early life. People are nervous. Honestly, they should be, but perhaps not for the reasons they think.
The narrative around HIMS has become dangerously one-dimensional. Most "experts" want to talk about one thing: weight loss drugs. They see the company as a glorified middleman for compounded GLP-1s. While that business has been a massive engine—driving revenue toward that $2.3 billion mark for 2025—it's also the company's biggest "sword of Damocles."
The GLP-1 Trap and the FDA's Change of Heart
If you want to understand why the stock price of hims took a 25% nose-dive in a single Friday session recently, you have to look at the FDA’s drug shortage list. For a long time, Eli Lilly and Novo Nordisk couldn't make enough of their blockbuster weight-loss shots (Zepbound and Wegovy).
Under U.S. law, when a drug is in "shortage," compounding pharmacies can step in. They make their own versions. Hims pounced on this, offering semaglutide for a fraction of the branded price. It was a goldmine. But then the FDA declared the shortage "resolved."
Suddenly, the legal loophole started to close. The company had to pivot, and fast. CEO Andrew Dudum has been vocal on X (formerly Twitter) about staying within the law, but the market hates uncertainty. Investors saw the "party" ending. They started selling.
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But here’s the thing: Hims isn't just a weight-loss company. Or at least, it’s trying not to be.
Beyond the "Skinny Shot" Hype
If you dig into the Q3 2025 earnings, the numbers are actually kind of staggering. Revenue was up 49% year-over-year, hitting nearly $600 million in a single quarter. You don’t get those kinds of numbers just from one trendy drug.
The company now has almost 2.5 million subscribers. These are people paying for:
- Hair loss treatments (the original bread and butter)
- Sexual health (the "blue pill" era)
- Dermatology
- Mental health services
What’s more interesting is the "multi-condition" user. About 20% of their users are now treating more than one issue on the platform. That’s how you beat "churn"—the industry term for people quitting a service. If a guy is getting his hair loss meds and his anxiety meds in the same box, he’s way less likely to cancel.
The Margin Squeeze of 2026
The big "bear case" for the stock price of hims right now involves margins. In 2025, gross margins dipped from 79% to 74%. Why? Because they’re spending like crazy.
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They are currently in a "build" phase. They’ve expanded to over 1 million square feet of facility space to control their own supply chain. They just bought Livewell to break into Canada. They’re launching "Labs" so people can get blood work done through the app.
Analysts at BofA Securities recently lowered their price target to $29, citing "2026 investment concerns." Basically, they think Hims is spending too much money on growth and not enough on being profitable right this second. It’s the classic Amazon-style trade-off. Do you want dividends now, or a behemoth later?
What Most People Get Wrong About the Competition
Everyone says Amazon Pharmacy will kill Hims. Amazon just announced they’ll offer Wegovy.
But Hims isn't a pharmacy. It’s a brand.
When a 28-year-old realizes his hair is thinning, he doesn't usually go to a sterile Amazon search bar. He goes to a site that feels like a lifestyle brand. Hims has spent hundreds of millions of dollars on marketing to make "getting medical help" feel like "buying a cool moisturizer." That brand loyalty is surprisingly sticky.
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The real threat isn't Amazon; it's the SAFE Drugs Act of 2025. This bipartisan bill in Congress is looking to crack down on mass-compounding. If that passes in its harshest form, the weight-loss revenue—which is projected to hit $725 million this year—could take a massive hit.
The Numbers You Need to Watch
If you’re trying to value this thing, forget the P/E ratio for a second (it’s currently around 55x to 60x, which looks expensive). Look at the Price-to-Sales (P/S).
Hims is trading at about 2.9x forward sales. Compare that to a legacy player like Teladoc (which is struggling at 0.5x) or a high-flyer like Doximity (at 12x). Hims sits right in the middle. It’s priced like a company that might be a giant, but hasn't proven it can survive a regulatory crackdown yet.
Some valuation models, like the Discounted Cash Flow (DCF) used by analysts at Simply Wall St, suggest an intrinsic value closer to $63. That would mean the stock is nearly 50% undervalued. But that assumes the growth doesn't fall off a cliff.
Actionable Insights for the 2026 Market
So, what do you actually do with this information? The stock price of hims is clearly in a transition period. It's moving from a "pandemic growth stock" to a "vertically integrated healthcare provider."
- Watch the "Labs" rollout. If Hims can successfully integrate diagnostic testing (blood work), they move from being a "pill mill" to a "primary care" platform. That changes their valuation entirely.
- Monitor the FDA "Shortage" Yo-Yo. The FDA has a habit of moving drugs on and off the shortage list. Any sign that semaglutide supply is tightening again will send the stock up 10% in a heartbeat.
- Check the Churn. In the next earnings report, ignore the top-line revenue for a second and look at "Monthly Online Revenue per Average Subscriber." It’s currently around $80. If that goes up, it means their "personalization" strategy is working.
- Regulatory Hedge. If you're long on HIMS, you're essentially betting that their legal team is smarter than the lobbyists for Eli Lilly. It’s a risky bet.
The company is aiming for $6.5 billion in revenue by 2030. To get there, they have to survive the "Investment Year" of 2026 without losing the trust of the retail investors who have kept the price afloat. It’s going to be a bumpy ride, but the underlying business is far more robust than the "skinny shot" headlines suggest.
Investors should treat 2026 as the year of "show me." The infrastructure is built. The subscribers are there. Now, the company has to prove it can keep them when the "easy" weight-loss money gets harder to find. Focus on the subscriber growth in non-weight-loss categories; that’s where the real long-term floor for the stock price actually lives.