Last Update 09 Dec 25
Fair value Decreased 3.56%HIMS: Menopause Expansion Will Drive Future Upside Despite Weight Loss Pricing Headwinds
Analysts have trimmed their average price target on Hims & Hers Health from approximately $46.00 to about $44.36 per share, reflecting expectations for stronger top line growth but slightly lower long term margins as GLP 1 pricing dynamics, competitive pressures and new service investments temper profitability and valuation multiples.
Analyst Commentary
Bullish analysts highlight that Hims and Hers continues to post solid growth trends despite near term headwinds. This supports the view that the company can sustain premium revenue growth versus broader digital health peers. They see the expanding treatment portfolio and international ramp as key levers to deepen customer relationships and reduce dependence on any single category.
At the same time, several firms view the new menopause and perimenopause offering as a strategic extension of the Hers brand that broadens the addressable market and diversifies revenue away from more competitive male focused segments. While near term financial contributions are expected to be modest, the service is seen as an important building block for 2026 and beyond.
On valuation, some research suggests that fair value estimates in the low to mid 50 dollar range remain achievable if Hims and Hers can execute on category expansion while maintaining disciplined customer acquisition and gradually improving unit economics. However, the path to that outcome is viewed as increasingly sensitive to GLP 1 pricing and competitive intensity in weight loss.
Bullish Takeaways
- Strong quarter over quarter growth trends, even with macro and regulatory headwinds, reinforce the view that Hims and Hers can continue taking share and support above market revenue growth assumptions.
- International expansion and new treatment categories, including menopause, are seen as structural drivers that expand the total addressable market and support a higher long term growth algorithm.
- Some fair value estimates in the low to mid 50 dollar range imply meaningful upside from current levels if management can balance expansion investments with gradual margin improvement into 2026.
- Brand strength and first mover advantages in direct to consumer healthcare are viewed as strategic assets that should help the company navigate tightening advertising rules and rising competition.
Bearish Takeaways
- Lower GLP 1 prices from large manufacturers and emerging platforms like TrumpRx narrow the Hims and Hers pricing advantage, raising concerns about the durability of its compounded GLP 1 economics and future margin profile.
- Bearish analysts argue that even if Hims and Hers remains the lowest price option today, further GLP 1 price cuts and the introduction of orals could pressure subscription pricing, valuation multiples, and long term profitability.
- Regulatory changes to direct to consumer advertising, especially stricter requirements for safety disclosures in social and TV campaigns, are expected to increase customer acquisition friction and marketing costs.
- Ongoing investment in new services and markets, while positive for growth, is seen as a constraint on near term margin expansion. This has led some firms to maintain Sell or Underperform ratings and lower price targets in the high 20s to low 30s.
What's in the News
- Hims and Hers launched Labs, a new diagnostics offering that uses Quest Diagnostics blood testing to deliver doctor developed insights and personalized treatment plans. CEO Andrew Dudum believes this platform can scale into a 1 billion dollar business (Wall Street Journal).
- The company announced an expansion into Canada through the acquisition of weight loss focused digital health platform Livewell, with a dedicated local leadership team and plans to launch a comprehensive GLP 1 based weight management program timed to the first expected availability of generic semaglutide.
- The U.S. FDA issued a warning letter to Hims and Hers over allegedly misleading marketing claims for compounded semaglutide products, citing misbranding violations and demanding corrective action.
- Hims and Hers authorized a new share repurchase program of up to 250 million dollars through November 2028 and has already bought back roughly 1.66 percent of its shares, indicating management confidence and ongoing capital return.
- The company introduced new menopause and perimenopause treatment plans on the Hers platform, adding a major women's health specialty that targets long under served patients and that is expected to expand further next year.
Valuation Changes
- The fair value estimate has decreased modestly from approximately $46.00 to about $44.36 per share, reflecting slightly more conservative long term margin assumptions.
- The discount rate is effectively unchanged, holding steady at roughly 6.96 percent, indicating no material shift in the perceived risk profile.
- Revenue growth has risen from about 15.72 percent to roughly 17.16 percent, signaling higher expectations for top line expansion.
- The net profit margin has declined from approximately 8.90 percent to around 8.01 percent, incorporating the impact of GLP 1 pricing dynamics and incremental investment.
- The future P/E multiple has edged higher from about 45.0x to roughly 46.5x, suggesting slightly richer valuation expectations despite the trimmed fair value per share.
Key Takeaways
- Diversification into new health categories, innovative tech integration, and international expansion are expected to drive sustained growth, operational efficiency, and increased global market share.
- Strong user adoption, enhanced personalized offerings, and industry trends toward telehealth position the company for higher recurring revenue and long-term earnings stability.
- Heavy dependence on growth segments and international expansion exposes the company to regulatory, operational, and margin risks, potentially resulting in revenue volatility and compressed profitability.
Catalysts
About Hims & Hers Health- Operates a telehealth platform that connects consumers to licensed healthcare professionals in the United States, the United Kingdom, and internationally.
- The company's expansion into new categories such as hormonal health (including menopause and low testosterone) and at-home lab testing demonstrates ongoing diversification and taps into large, underserved patient populations-this is likely to drive sustained top-line growth and support better revenue retention as more customers engage with multi-condition offerings.
- Strong user adoption and high retention rates, especially with personalized, daily health and weight loss programs, combined with new subscription features and increasing company focus on customer experience, set the foundation for improved customer lifetime value and higher recurring revenue, positively impacting long-term gross margins and earnings stability.
- Integration of AI-powered personalized care agents, unified data platforms, and advanced automation is expected to drive efficiency across clinical operations, patient support, and inventory management, leading to lower variable costs over time and meaningful operating leverage that boosts EBITDA margins.
- International expansion enabled by the ZAVA acquisition and impending launches in Canada and select European markets positions Hims & Hers to capture significant global market share as digital health infrastructure and consumer openness continue to grow, accelerating multi-year revenue growth potential.
- Industry-wide shifts toward consumer-driven and preventive healthcare, coupled with the destigmatization of topics like sexual and mental health, are expanding the total addressable market for telehealth-and Hims & Hers' early-mover advantage and platform innovation could translate to outsized earnings growth as secular demand continues to rise.
Hims & Hers Health Future Earnings and Revenue Growth
Assumptions
How have these above catalysts been quantified?- Analysts are assuming Hims & Hers Health's revenue will grow by 18.3% annually over the next 3 years.
- Analysts assume that profit margins will shrink from 9.6% today to 7.8% in 3 years time.
- Analysts expect earnings to reach $261.3 million (and earnings per share of $1.21) by about September 2028, up from $193.6 million today. However, there is some disagreement amongst the analysts with the more bullish ones expecting earnings as high as $304.1 million.
- In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 57.6x on those 2028 earnings, up from 55.8x today. This future PE is greater than the current PE for the US Healthcare industry at 21.0x.
- Analysts expect the number of shares outstanding to grow by 3.45% per year for the next 3 years.
- To value all of this in today's terms, we will use a discount rate of 6.78%, as per the Simply Wall St company report.
Hims & Hers Health Future Earnings Per Share Growth
Risks
What could happen that would invalidate this narrative?- Expansion into international markets with government-run healthcare systems (like the UK, Germany, France, Canada) introduces regulatory, reimbursement, and adoption risks that may limit customer growth, raise compliance costs, and dilute management focus, potentially impacting future revenue growth and net margins as the company commits resources to these regions.
- Revenue growth remains heavily reliant on high-growth segments such as weight loss (GLP-1) and daily sexual health offerings, making the business vulnerable to regulatory changes, shifts in consumer sentiment, competition, or commoditization in these categories, which could result in revenue volatility and pressure on earnings.
- Ongoing and planned investments in technology (particularly AI, data integration, and personalization), lab infrastructure, and talent are substantial and may lead to margin compression or higher operating expenses, especially if expected efficiencies or customer retention improvements do not materialize at scale.
- Marketing efficiency has been volatile, driven by the need for increased spend to launch new specialties and enter new markets, as well as seasonality; any sustained customer acquisition cost inflation or inefficiencies could compress net margins and reduce the return on marketing investment over time.
- The transition away from on-demand offerings toward more premium daily models in core verticals (like sexual health) and changes in shipment cadence for personalized GLP-1s create short
- and medium-term headwinds for average revenue per user, retention, and subscriber growth; if new offerings fail to offset these declines, it could result in slower top-line growth and weaker financial performance.
Valuation
How have all the factors above been brought together to estimate a fair value?- The analysts have a consensus price target of $49.455 for Hims & Hers Health based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $85.0, and the most bearish reporting a price target of just $28.0.
- In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $3.3 billion, earnings will come to $261.3 million, and it would be trading on a PE ratio of 57.6x, assuming you use a discount rate of 6.8%.
- Given the current share price of $47.79, the analyst price target of $49.45 is 3.4% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
- We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.
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