A Profitable Company Under Siege: The Curious Case of Hims & Hers

Hims & Hers US4330001060

A striking contradiction is unfolding for Hims & Hers Health, Inc. on Wall Street. Despite the telehealth platform demonstrating rapid growth and achieving profitability—a rare feat among its peers—the stock finds itself as a prime target for short sellers. This pronounced bearish sentiment from professional investors raises questions, especially as the share price languishes well below its summer peaks.

Data reveals Hims & Hers is currently among the top five most heavily shorted equities on Wall Street. Between 32% and 37% of its available shares have been sold short, depending on the data source. This aggressive bet against the company is particularly notable because Hims & Hers stands alone in this top-ten list of shorted stocks: it is the only one that is both profitable and generating positive free cash flow.

Operational performance seems to contradict the pervasive skepticism. For the third quarter of 2025, revenue surged approximately 49% year-over-year, and the company's balance sheet is considered robust. Yet, the market's distrust is evident in the share price, which closed at $29.62 on Friday, marking a decline of over 11% since the start of the year.

The Weight of Competition: Missing the GLP-1 Wave

A core driver of investor concern is intensifying competition in the weight management sector. The explosive demand for oral GLP-1 medications, exemplified by Novo Nordisk's Wegovy in tablet form, is creating a significant market shift. Prescriptions for such drugs reportedly jumped from about 4,300 to over 20,000 within a single week, according to Symphony Health data.

The issue for Hims & Hers is one of portfolio absence. While competitors including Ro, WeightWatchers, and Amazon have begun offering these oral GLP-1 treatments, they remain conspicuously unavailable on the Hims platform. The fear among market participants is that the company is missing a critical trend, potentially ceding ground and future growth to rivals.

Internal Signals and Divided Opinions

Adding to the uncertainty is the trading activity of company insiders. Over the past twelve months, insider sales have totaled $209 million. Notably, this figure stands against a complete absence of insider purchases during the same period. Most recently, Chief Financial Officer Yemi Okupe sold another block of shares on January 20.

The analyst community reflects a divided outlook. Deutsche Bank maintains a price target of $42, suggesting significant upside. In contrast, Bank of America holds a $29 target, cautioning that market expectations for 2026 may be overly optimistic. The prevailing consensus rating across analysts, however, remains a cautious "Hold."

Management's Response and the Path Forward

In an effort to bolster confidence, the company's leadership has authorized a share repurchase program worth $250 million, equivalent to roughly 3% of outstanding shares. Concurrently, Hims & Hers is investing aggressively in talent, recently recruiting artificial intelligence experts from firms like Cruise and Snap to enhance its technological infrastructure.

Following a quiet period of more than 40 days without major corporate announcements, investors are now focused on the upcoming quarterly results. A key factor will be whether management can articulate a clear strategy for integrating new GLP-1 therapeutics into its platform. Success in bridging this competitive gap is likely crucial for shifting the prevailing negative market narrative.