Hims & Hers Health (HIMS) Valuation in Focus After Novo Nordisk Deal Collapse and Legal Scrutiny

The sudden end of Hims & Hers Health's partnership with Novo Nordisk is making waves for anyone tracking the stock. On the surface, this might seem like just another business deal gone sideways. However, with accusations flying about misleading statements, an abrupt exit from the GLP-1 weight-loss drug agreement, and legal action in full swing, it is no wonder investors are taking a closer look. The stock’s sharp drop, more than 34% on news of the event, reflects how seriously the market views the reputational and regulatory risks now facing the company.

This legal fallout arrives just as Hims & Hers Health (HIMS) appeared to be hitting its stride. Earlier this year, the share price was up by more than 77%, well above industry peers. Impressive revenue and net income growth undoubtedly built momentum for the telehealth company, with subscriber numbers and personalized healthcare offerings drawing attention. Still, the past month’s double-digit slide shows how fast momentum can pivot, and how much short-term sentiment can overpower even long-term outperformance.

After a rollercoaster year for Hims & Hers Health, are shares being marked down unfairly, or is the market signaling that future growth is less certain than it once seemed?

Most Popular Narrative: 48.2% Undervalued

According to the narrative by BlackGoat, Hims & Hers Health is trading well below what they consider its fair value. This may present a rare opportunity for investors.

At around $35 per share as of May 2025, Hims trades at less than half our estimated $114 fair value. This is despite rapid growth, expanding margins, zero debt, and growing penetration across high-value healthcare verticals. Investors have a rare chance to own a profitable, fast-scaling platform early in its evolution into a category-defining business.

What is driving this high valuation target? The narrative incorporates a unique mix of aggressive growth assumptions and forward-thinking profit metrics. For those wondering what differentiates this stock and what numbers support such a projection, the full narrative provides detailed insights behind these headline figures.

Result: Fair Value of $114 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, risks such as heightened regulatory scrutiny or tighter prescribing standards could quickly undermine this optimistic growth narrative and unsettle investor confidence.

Find out about the key risks to this Hims & Hers Health narrative.

Another View: What Do Market Ratios Say?

While some models see upside, a look at how shares trade versus sector averages raises eyebrows. Compared to others in this space, the company’s valuation is notably higher. Does the market know something the models do not?

See what the numbers say about this price — find out in our valuation breakdown.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Hims & Hers Health for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Hims & Hers Health Narrative

If you see things differently or like to dive deeper into the details, you can build your own personalized analysis in just a few minutes, or do it your way.

A great starting point for your Hims & Hers Health research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

Looking for More Investment Ideas?

Do not let a single story define your portfolio. Markets offer many compelling opportunities for those willing to look. Use these unique ideas below to get ahead, spot value before the crowd, and strengthen your investing strategy with Simply Wall Street’s powerful filters.

• Uncover strong potential with undervalued stocks based on cash flows to find companies trading below their true worth while others overlook them.
• Accelerate your income by searching for dividend stocks with yields > 3% to capture stocks offering attractive yields that can boost your cash flow in any market.
• Explore the future of medicine by following healthcare AI stocks and invest where innovation meets healthcare breakthroughs and new growth opportunities.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com