In a report released today, Daniel Grosslight from Citi maintained a Sell rating on Hims & Hers Health, with a price target of $30.00.
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Daniel Grosslight has given his Sell rating due to a combination of factors impacting Hims & Hers Health. The recent warning letter from the FDA highlights concerns over the company’s marketing practices, specifically regarding claims made about its compounded semaglutide product. The FDA’s objections to the language used by Hims & Hers Health suggest that the company must revise its promotional strategies to comply with regulatory standards.
Additionally, the increased scrutiny from regulatory bodies could lead to higher customer acquisition costs (CACs) for the company. While Hims & Hers Health has previously managed to adapt to marketing challenges, such as changes in iOS and Meta advertising policies, the current regulatory environment poses a significant risk. These factors contribute to the expectation of a substantial decline in the company’s share price, justifying the Sell rating.
In another report released yesterday, Bank of America Securities also reiterated a Sell rating on the stock with a $28.00 price target.