Stock Analysis

Hims & Hers Health, Inc. (NYSE:HIMS): Are Analysts Optimistic?

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NYSE:HIMS
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Hims & Hers Health, Inc. (NYSE:HIMS) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Hims & Hers Health, Inc. operates a telehealth platform that connects consumers to licensed healthcare professionals. With the latest financial year loss of US$66m and a trailing-twelve-month loss of US$36m, the US$1.8b market-cap company alleviated its loss by moving closer towards its target of breakeven. The most pressing concern for investors is Hims & Hers Health's path to profitability – when will it breakeven? We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

Check out our latest analysis for Hims & Hers Health

Consensus from 10 of the American Healthcare analysts is that Hims & Hers Health is on the verge of breakeven. They anticipate the company to incur a final loss in 2024, before generating positive profits of US$32m in 2025. So, the company is predicted to breakeven approximately 2 years from now. How fast will the company have to grow each year in order to reach the breakeven point by 2025? Working backwards from analyst estimates, it turns out that they expect the company to grow 76% year-on-year, on average, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

earnings-per-share-growth
NYSE:HIMS Earnings Per Share Growth December 11th 2023

Given this is a high-level overview, we won’t go into details of Hims & Hers Health's upcoming projects, however, take into account that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. Hims & Hers Health currently has no debt on its balance sheet, which is quite unusual for a cash-burning growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Hims & Hers Health which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Hims & Hers Health, take a look at Hims & Hers Health's company page on Simply Wall St. We've also put together a list of essential factors you should further examine:

  1. Valuation: What is Hims & Hers Health worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Hims & Hers Health is currently mispriced by the market.
  2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Hims & Hers Health’s board and the CEO’s background.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

Valuation is complex, but we're helping make it simple.

Find out whether Hims & Hers Health is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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