Telehealth And Hormonal Health Will Transform Global Markets

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

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

• 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

• 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

• 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.