Hims & Hers Stock Defies Analyst Concerns with Strategic Pivot

Hims & Hers US4330001060

Despite being excluded from a major pharmaceutical partnership for the second time, shares of Hims & Hers Health, Inc. advanced on Monday. The move comes as Novo Nordisk announced the broad U.S. rollout of its oral Wegovy weight-loss pill, partnering with CVS Health, Costco, LifeMD, and GoodRx instead. Market experts point to a strategic clash as the reason for the omission, yet the company's equity still posted its strongest single-day gain in a month.

Analysts at Citi suggest the ongoing exclusion of Hims & Hers from Novo Nordisk's distribution network stems from a fundamental disagreement. The core issue appears to be Hims & Hers' strategy of offering its own semaglutid-based compounded formulations. These customized mixtures, which circumvent FDA approval pathways during drug shortages, are reportedly viewed as problematic by Novo Nordisk.

Consequently, Citi maintains a Sell rating on the stock, with a price target of $30. The firm's analysis indicates that the widespread availability of oral Wegovy will likely create sustained pressure on Hims & Hers' GLP-1-related business through 2026.

Broadening the Horizon Beyond Weight Management

In response to the intensifying competition in the GLP-1 sector, Hims & Hers is actively executing a diversification strategy. The company is expanding its operational footprint and service portfolio to reduce reliance on the contested market for weight-loss medications.

Key initiatives include:
* International Expansion: Launching a weight-loss program in the United Kingdom and officially introducing its Hers platform for women there. The company has also entered the Canadian market following its acquisition of the digital health platform Livewell.
* Diagnostic Services: The introduction of Labs, a blood-testing service that provides insights into heart health, metabolism, hormones, and inflammation.
* Technology Acquisition: A planned takeover of YourBio Health, the developer of the TAP device, which enables blood sample collection using microneedles without drawing blood.

This multifaceted approach has garnered positive attention. Barclays initiated coverage of the stock in December with an Overweight rating and a $48 price target, citing these very expansion efforts as new growth drivers.

Competitive Pressures and Market Performance

The landscape for GLP-1 treatments is becoming increasingly crowded. Eli Lilly is developing an oral candidate called orforglipron, while Pfizer and Structure Therapeutics are also working on pill-based alternatives. Both Novo Nordisk and Eli Lilly have reduced cash prices for lower doses to improve patient access.

Nevertheless, Hims & Hers shares climbed 2.12% on Monday to $35.46, marking a slight increase since the start of the year. Investors now await the company's fourth-quarter 2025 results, scheduled for release on February 23. Management has provided revenue guidance of $605 million to $625 million for the period. Looking further ahead, analysts project full-year 2026 revenue growth of approximately 18%, reaching $2.77 billion.