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Welcome back to the rundown for another weekend deep dive. Today we are talking about hims. This company and its stock price have been on a roller coaster the last 12 months, from super bowl ads to legal fights with pharma giants around copycat weight loss drugs, and everything else in between. So in today's episode, we're going to break down how Hims got here, why Wall street got so obsessed with this company, the bull and bear case moving forward, and whether HIMS is building the future of digital healthcare or doomed for here. We got a great one for you today. Let's dive in. Now, before we get into the bull and bear case for the company, let's start with the backstory. Hims was founded back in 2017 as an online native pharmacy. This was during the time when there was a boom in telehealth companies. HIMSS built their brand by focusing on the awkward healthcare stuff. They provided treatment for hair loss and ED and skin care issues. The brand was very sleek and modern. Everything was accessible through their app and the medications shipped directly to your door. You know, it was a huge upgrade from the traditional experience of going to a doctor's office, waiting hours at the waiting room, and then having an awkward conversation with the doctor for five minutes. So HIMS was able to find success pretty quickly. The revenues jumped from $26 million in 2018 to $272 million in 2021, which is also the year the company went public. Now let's Fast forward to 2024. This was a pivotal year for the company because this is when they moved into the GLP1 weight loss category. The GLP1s had started getting popular around 2022 ish. I remember seeing a bunch of articles and tiktoks about celebrities on ozempic and Manjaro. GLP1s were originally made to help type 2 diabetics manage their blood sugar, but they also turned out to be incredibly effective for weight loss. So everyone was trying to get their hands on them. Unfortunately, there wasn't enough supply to meet the demand. So the FDA actually put semi gluten, which is the active ingredient in Ozempic, on its shortage list in mid-2022. And that opened the door for hims to jump in. See, when a drug is added to the FDA shortage list, that allows compounding pharmacies to legally make copycat versions of the product and sell them. So him started selling personalized compounded GLP1 treatments for like $200 a month. You compare that to Ozempic, which was selling for $1,000 a month at the time. You can see why this was a massive hit for hims. Revenues in 2024 jumped 69% to $1.5 billion. Their subscribers increased 45% to 2.2 million people. And the stock price reflected all of that. HIMS went from a $10 stock in early 2024 to all time highs of $69 in February of 2025. You know, HIMS was kind of feeling themselves at the time. They even dropped a Super bowl commercial in February of 2025. Well, it turns out that super bowl commercial might have been the peak for the company because the last 12 months have been bumpy for Hims. Hims was riding high. In February of 2025, they had just dropped a provocative super bowl ad that had everyone talking. Their app shot up to number two on the App Store's health category, and their stock was near all time highs. Well, then the GLP1 environment changed again, and this time it threatened him's entire weight loss business. See, two weeks after the super bowl, the FDA announced that semi glutide, which is the active ingredient in Ozempic, was no longer on the shortage list. That was a huge problem for HIMS because that shortage was the legal justification they had for selling their cheaper compounded GLP1s. So this announcement by the FDA caused him stock to drop 25% in a single day. But here's the thing though. Hims didn't really stop selling the GLP1 knockoffs. They just kept selling them under a different regulatory loophole. See, compound pharmacies are still allowed to make customized medications in certain cases, even when the drug is no longer on the shortage list, they can do it for personalized treatment. And that's the loophole that HIMS was using. Well, big pharma companies like Novo Nordisk, which is the maker of Ozempic, they finally had enough. Novo Nordisk went on the offensive and threatened lawsuits. But HIMS kept pushing their luck. In fact, they went a step further in early 2026. See, earlier this year, Novo Nordisk launched the Wegovy pill. It was the first GLP1 pill on the market, and Novo Nordisk was selling it for around 150 to $300 a month. Well, a couple weeks after the Wegovy pill came out, Hims came out with their own compounded oral semi glutide pill for just $49 a month. So hims was straight up copying Novo Nordisk signature pill and selling it for much cheaper. And I think HIMS might have pushed their luck too much because the FDA immediately came out with a warning, threatened to crack down making copycat GLP1 products. Him stock tanked following those comments from the FDA, and the company quickly removed the GLP1 weight loss pill from their website. Unfortunately, the cat was out of the bag. Novo Nordisk officially filed the lawsuit against Hims on February 9. The lawsuit alleged that Hims was infringing on their patents and unlawfully promoting compounded versions of Wegovy and Ozempic on their website. So that was a big deal because at that point, hims biggest growth engine was facing a major legal and regulatory hurdle. At its low point this year, HIM stock has lost half its value. But then, out of nowhere, a major breakthrough emerged. So let's talk about that breakthrough and the bull case for Hims moving forward. On March 9, Nova Nordis shocked some people by announcing that they were dropping their lawsuit against Hims and instead planning to partner with them. Under this partnership with the two companies, HIMS would sell in Novo Nordisk's FDA approved Ozempic injections and Wegovy pills and injections directly on their platform starting later this month and in the future. Both companies even plan to collaborate on bringing additional products to market as they became available. Now, in exchange, Hims agreed to stop advertising and selling their compounded knockoff GLP1s. Honestly, it seems like Hims got the better end of this deal because these compounded GLP1s they were selling were facing a legal and regulatory ban anyways. Investors seem to agree. Him stock jumped over 50% in the past week after this deal was announced. In fact, it's the best week on record for the company. On top of that, multiple Wall street analysts upgraded the stock following the deal with Nova Nordisk. But what might be even more significant than the Nova Nordisk deal is how the FDA reacted to that deal. FDA Commissioner Marty McCary publicly praised the agreement, calling it a win for the American people. He said that he was glad that HIMS would stop advertising unapproved compounded drugs and would keep prices affordable. That is a very sharp contrast from just weeks earlier, when the FDA was threatened to take decisive steps against companies mass marketing illegal copycat drugs and referring HIMS to the Department of Justice. So HIMS kind of solved a lot of problems here. They got the FDA off their back, and Novo Nordisk has gone from being an enemy to an ally. That alone removes the single biggest existential risk hanging over the stock. Now, if you look at the company's business, the underlying numbers have Been solid. Hims pulled in $2.35 billion in revenue in 2025, which was up from the $1.5 billion in 2024. 2025, with 2.5 million subscribers, weight loss continues to be the engine for the company's growth. Last quarter, weight loss subscribers grew 70%. So the growth in weight loss is a key factor influencing the bull case. But in the latest earnings call, CEO Andrew Dudham was trying to ease investors concerns that HIMS isn't just a one trick pony. He said that HIMS has made progress scaling offerings in other categories, such as testosterone or hormonal therapy and lab testing. Those were all added to the platform in the second half of last year. On top of that, Hims continues to grow its women brand, called Hers. The revenue for the Herz division grew 100% in 2025, and it's rapidly approaching the $1 billion in annual sales. And the company sees a ton of upside when it comes to adding subscribers. Right now, they have 2.5 million users. But given that more than 70% of Americans are overweight, there's plenty more room to capture more of the total addressable market, just in the weight loss category. And once these patients come on the HIMSS platform for weight loss, HIMSS can now offer more treatment options to patients who are looking for accessible and convenient care through a telehealth provider. And finally, there's also the international expansion of HIMS business. HIMS has been making aggressive moves overseas. Last year, they acquired Zava, which is a European telehealth company, which gave them a presence in the UK Germany, France, Ireland and Spain. They also acquired a company called Live well to enter Canada, which is notable because Canada is expected to be one of the first first markets to get access to generic semi glutide. And then in February of this year, HIM signed an agreement to acquire Eucalyptus, which is a global health company that HIM says will further strengthen their presence in the UK and Europe. It also brings the HIMs and HERS brand into new markets like Australia and Japan. So to sum up the bull case for hims, you have the Nova Nordisk partnership removing the biggest overhang on the stock. The core business is still growing, the platform is expanding into new treatment categories, and there's real international growth ahead. A pretty compelling bull case for the stock. But now we gotta talk about some of the risks and the bear case the company faces moving forward. All right, now let's talk about the bear case, because there are some real risks facing the company. Let's talk about the biggest one, it's a potential decline in revenue and margin. See, this partnership with Novo Nordisk is a big deal, but it's going to impact Hims's business model. See, when Hims was selling compounded semi glue tied GLP1s, they were essentially making the product themselves through their pharmacy network and selling it directly to customers. So that meant they booked the full revenue from every sale. So when a customer paid $199 a month for their semi glue tied, HIMS kept most of that money. But now with the branded Novo Nordisk products, the economics are completely different. According to analysts at Canaccord Genuity, when HIM sells Novo Nordisk FDA approved drugs, they're likely to recognize revenue on a net basis. So that means that HIMS only books their cut of the transaction, not the full sales price. And this is where things get tricky. See, right now Hims has a bunch of subscribers paying for compounded GLP1s, where they book the full revenue, the $200 a month. As those subscribers come up for renewal and they transition to the branded WeGovy or Ozempic shots, revenue per customer could actually go down, even if the customer is paying the same or even more. So the key number to watch here is going to be what HIMS reports as their top line revenue and on their next earnings call. And also if the company cuts their revenue guidance moving forward, if they do, it might be because what we just talked about, the second risk facing the company is that this Novo Nordisk partnership could fall apart at any moment. See, back In April of 2025, Novo Nordisk and Hims actually tried a very similar agreement where hims would sell WeGovy through its platform. But then, less than two months later, Novo publicly terminated that deal and accused HIMS of illegal mass compounding and deceptive marketing. These days, Novo Nordisk has a new CEO. And he said that this time it's going to be different because HIMS has agreed to fundamentally change their business model. But if HIMS doesn't fully comply, Novo Nordisk did leave the door open by saying that they reserved the right to sue HIMS again. So that's a risk right there. This deal could blow up at any time. And finally there's competition from other telehealth companies in the space. You know, RO is another major telehealth platform. They've been working with Novo Nordisk already. And then you have Eli Lilly and their platform, Lilly Direct. Now Eli Lilly is a trillion dollar pharma giant behind Zepbound and Manjaro. Both those drugs are actually more popular and effective than Ozempic and WeGovy. And Lilly sells these products directly through their platform called Lilly Direct. That is a competitive platform to hims. So, yeah, the competition in the weight loss telehealth space is pretty competitive. And beyond that, there's still concerns that HIMS is still overly reliant on weight loss and that their other categories of treatment are still too early. The market is worried that HIMS has all their eggs in one basket. And then if the fact that the stock is down like 60% from its February 2025 highs, a lot of people that bought near the top have been underwater on the stock for a year now. It also doesn't help that the CEO sold over $33 million in stock in a single trade last August, followed by another $11 million in sales in October. Now, to be fair, those sales were under pre planned trading agreements, but it's not a great look when your CEO is dumping their stock when the company's business model was under fire. So rebuilding that trust for HIMS could take time. And I think the next couple of earnings reports are going to be absolutely critical for the company. So what's my take here? Honestly, I've always been a bit hesitant when it comes to hims. The stock was too meme stocky for me, so I never really invested myself. There's just too much hype and I always kind of ignored it. But you know, I gotta say, the company is starting to figure things out. I think this partnership with Novo Nordisk is a big deal and a sigh of relief for the company. And the company seems to be aggressively expanding into other areas of treatment and internationally. The fact that they have 2.5 million subscribers shows that they're starting to reach scale. When you look at valuations, I still have some concerns. The company currently trades at a 45 times price to earnings ratio and the average price target from Wall street firms covering the stock is $28. So not a ton of upside from the current levels. I guess the biggest concern that I have is that this Novo Nordisk partnership fundamentally changes the business model for the company. So I'm gonna be paying attention to the next couple earnings reports and see what it looks like under this new model. Well, all right guys, that's it for today's weekend deep dive. Hope you guys enjoyed that one. Let me know in the comments on what your thoughts are on HIMS and if you're bullish or bearish on the company going forward. Also, let us know what topics you want us to cover in future Deep Dive episodes. And while you're at it, if you have like five extra seconds, consider giving us a five star rating on Apple, Spotify, YouTube, wherever you listen to your podcasts. You know, all that engagement really does help us out and it helps other people find the show. Thank you guys again for listening, watching and commenting. Shout out to Mike and Connor for all the work behind the scenes and we'll see you guys back here tomorrow.
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