HIMS Stock Analysis: Is It Still Worth Buying?

Hi, I'm Jimmy. In this video, we're looking at Hims & Hers Health, ticker symbol HIMS. So, in this video, we're going to run through the basics of what Hims & Hers does from a business perspective. We're going to look quickly at some of their competitors, and then we're going to run through some of their numbers. Finally, we're going to try to come up with a fair value for Hims & Hers stock to see if it's worth investing in today. Now, we're going to do the entire analysis on the Investors Grow website. So, if you'd like to sign up to get access to that, I'll leave a link in the description below. Okay, so let's jump right in. So, Hims & Hers is a digital health platform. Basically, you go to the app, you answer some questions, and then what they say happens a licensed healthcare provider reviews the information, and basically, if they think that a prescription makes sense, they can fill it for you at one of their partner pharmacies and ship it to you every month or every quarter whenever you need it, however often you need it. Now, obviously, they can't do this for all medicines, but they started by targeting some conditions that, let's say, you might not want to go to the doctor. Perhaps you might be embarrassed about it. This is a list of conditions that they said that they're targeting, and they specifically said they're targeting some of the more sensitive ones that wouldn't necessarily have some of the same restrictions that some more high-powered medicine might have, but medicines that could tackle some of these problems. Now, when we think about their business, they call it Hims & Hers. There's actually two sides to their business. The Hims side treats men, the Hers side treats women. It's really that simple. Now, they said in 2025 that the Hers brand represents about 40% of revenue. So, we can just say that revenue is split about 60/40 between Hims and Hers. Now, here's the trick or the key to this company that kind of makes them unique, and that is they make most of their money from subscriptions. Most of their revenue comes from customers. So, customers might sign up and they might need a prescription every 30, 60, 90 days, something like that, and they will get billed on that same schedule. So, it's not necessarily like a monthly scheduling, but they do break the numbers into monthly numbers. We'll look at those in a second. But, the interesting part is this is a mostly a cash pay system. So, you might pay, you know, $75 a month and you get your prescription, and that's kind of your monthly fee, but for the most part, insurance stays out of it. Now, they do have a small piece of their business where they sell some products in stores, but in 2025, they said that 98% of the revenue came from online sales. So, their subscription business and all that stuff. So, that takes up uh the that generates the vast majority of the revenue, but they have dabbled in some physical selling. So, that's a possibility for the future. Okay, now, let's jump over and look at some of their competitors. So, one of their competitors is uh is Teladoc, ticker symbol TDOC. Teladoc is probably the biggest public name in telehealth. Uh a big part of their business is in their integrated care segment, and they also have their BetterHelp segment, which goes directly to customers. So, the integrated care deals more with companies, like they try to integrate with your company, where uh BetterHelp goes after individuals, kind of like Hims & Hers does. Now, one interesting part when I looked quickly at some of their numbers is revenue actually dropped last year about 2% for them. So, for me, when I was looking through some of their competitors, right now, Hims & Hers looks like the better one. Okay, now, another company that I came across, and this is a small one, but this is LifeMD, ticker symbol LFMD. Now, they do have some interesting overlap with their products. They have some uh weight management, uh men's health, like hair loss products, things like that. They even have some pharmacy capabilities like Hims & Hers does. But, last year, they only generated a little less than $200 million in revenue, whereas Hims & Hers generated about 2. 3 billion in revenue. So, right now, they don't appear to be a direct threat. In fact, they're far more likely to be a, let's say, an acquisition target. And then, the last one we should probably be aware of is Amazon. So, Amazon has One Medical and Amazon Pharmacy, and they even started recently offering telehealth visits for some conditions that compete with what Hims & Hers does, and they charge, let's say, 29 bucks for a phone call or maybe 49 bucks for a video visit, and then they can prescribe, they can offer prescriptions just like Hims & Hers does. Now, as of today, it's not a meaningful part of what Amazon does, and it hasn't really stopped the industry from continuing to grow, but when Amazon enters a business, we should probably at least be aware of the fact that they're out there. Okay, now, let's jump over and look at some of their numbers. And as is true with most companies, I think it makes sense to start with a chart of revenue. Now, we might notice that this revenue chart only goes back to 2019, and that is because this company is a very young company, and you can see that they've had fantastic revenue growth. They grew from about $83 million in 2019 to almost 2. 4 billion in 2025.

Then, when we switch over and look at net income, and that's profit, well, things get a bit more interesting here. For a while, they were not profitable, and then in 2024, they went profitable, and then it looks kind of like they stayed flat. Now, I was actually curious, like, how could they grow revenue as much as they did and then kind of stay flat from a profitability standpoint? Well, this isn't a major impact, but in 2024, they actually had a $54 million tax benefit. So, profit actually would have been a little bit lower that year. But, either way, they went profitable, and they have stayed profitable so far, which is good, and clearly, that's an important thing. But, now, we're going to get into the weeds real quick and look at one of the numbers that I think is very important to what this business does, and it's been one of the drivers of the stock for a while. So, this is a chart of gross profit margin, and basically, gross profit margin is what's remaining after their direct cost for creating the product and fulfilling the product. So, back in 2019, well, they had they really didn't have the scale that they have today. So, we could see that the numbers kind of ramped up. But, then, from a gross profit margin perspective, in 2023, well, management had come out and said in that annual report, they talked about the fact that their they used more affiliated pharmacies, they got some better pricing, so they got higher profit margin. So, profit margins went up there. But, actually, when we switch this over to a quarterly chart, well, switching to a quarterly chart here, we can see that since then, things have kind of drifted lower. Now, one of the things that affects gross profit margin for them is, let's say, the cadence of the products that they send out. So, if you want your product every 30 days, that's a decent amount of shipping costs. It's a flat fee for you, so it's a decent amount of shipping costs that Hims & Hers will do. But, imagine you got that same prescription just once a year. Well, once a year, it's a lot cheaper for them. Point is, same cost, they get a bigger profit margin from that. Okay, now, there's some things that have come up in recent news that we should be aware of. So, in May of 2024, Hims announced access to GLP-1 injections, and this is a weight loss drug. And this was huge timing because at that time, there was shortage going on in this category, and then in April of 2025, they announced a collaboration with Novo Nordisk. Well, that deal blew up kind of fast, and in June of 2025, Novo terminated the collaboration and accused Hims of deceptive marketing and illegal mass compounding. Then, in September of uh in September, well, the FDA sent Hims a warning letter over misleading claims around their compounded uh semaglutide, I'm going to go with. That's That After that, Novo came out and sued Hims in February of 2026. Well, fast forward just a little, in March of 2026, Hims said it would stop advertising their compounded GLP-1s broadly and only offer compounded semaglutide, whatever that is called, on a limited basis when it was clinically appropriate is how they defined it. And as of March 2026, well, Hims says Wegovy injections and pills, Ozempic injections, are all available to eligible customers on their platform. Now, this is likely to put downward pressure on their profit margins, partially because these brand-name drugs are going to be a little less profitable for Hims to sell on their platform. Now, Hims has come out and said that their other business lines, their other product lines that they're selling, have continued to grow. Plus, in the US the majority of their revenue in general came outside of their weight loss drugs. So, although weight loss drugs was a vast growing business in '24 and '25, it wasn't the only drug that was growing. Now, interestingly, in 2024, they got about, on average, $65 per month for every subscriber that they had, and that jumped to $83 per month in 2025. Now, they said this was driven largely by stronger uptake of personalized offerings, and they're even doing some cross-selling. So, if you're perhaps taking one of their weight loss drugs, maybe that's why you signed up, well, maybe you also want one of their other services that they offer, one of the other drugs that you can get your hands on through them. Well, that kind of increases their average monthly revenue. Okay, now, with all of that being said, let's jump over and look at free cash flow to see if we can come up with a fair value for Hims & Hers Health using discounted free cash flow. So, when we jump over to our discounted free cash flow calculator, well, here we can see, using analyst estimates, analyst estimates are the green bars, historical numbers are the blue bars. Now, free cash flow might be one of the better valuation methods with this particular company because we in this case, we have analyst estimates. So, analyst estimates going up the next 5 years, we can see they have free cash flow growing, but not by an obscene amount. They It's actually very reasonable growth, and this puts the fair value of the stock at about $29 per share using just these analyst estimates. Now

that might be better than something like a price-to-earnings multiple. For example, we jump over and look at the forward PE chart. Well, we could use it and it's about fair. It's on a bit on the high end. It's about fairly valued right now. It's a bit on the high end, but I think that the bigger problem is there's not a lot of data here. This company just went profitable. So, we don't have a ton of great information there. The biggest advantage of this guy on a free cash flow in this particular setup is that we have analyst estimates and we can see what analysts are expecting over the next few years. So, if analysts are anywhere near close, well, the stock looks like it's reasonably undervalued right now. Now, for me on a personal basis, I actually like this company. I think that this company is an interesting addition to my long-term buy and hold portfolio where I don't really have a lot of health care exposure. And this company seems like it's well positioned to do fairly well. Back when Novo Nordisk sued them, well, the comp the stock got pulled back and it hasn't really recovered all that much since then. As you can see here, the stock's down about 30% for the year. So, I think below 20 bucks a share looks like it could be a decent value. Now, for me, what I plan on doing is I'll wait a few days as a my own personal rules at rule after I release a video. I like to wait a few days, give you guys time to do your own research. Let me know what you guys think of this company. I think it's an interesting one. I think it could be a good long-term buy and hold that over the long run could do fairly well. revenue has grown at a fantastic pace. And as they scale up, I think that there's plenty of upside for this type of company. Now, if you want to sign up to get access to the Investors Growth website, I'll leave a link right here. Link in the description below. And thank you so much for sticking with me all the way to the end of the video. I really do appreciate it. Thank you, but I'll see you in the next video.