Allen Lutz, an analyst from Bank of America Securities, reiterated the Sell rating on Hims & Hers Health. The associated price target remains the same with $28.00.
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Allen Lutz has given his Sell rating due to a combination of factors impacting Hims & Hers Health. One significant concern is the declining core sales growth, which fell by 4% month-over-month, likely due to increased competition and seasonal factors. This slowdown in core growth is troubling as it creates a challenging outlook for the second half of the year, with the company’s future guidance heavily reliant on the acceleration of compounded semaglutide contributions and new product sales to offset the weakening core.
Additionally, while GLP-1 sales surged by approximately 35% in June, this growth is primarily driven by compounded GLP-1s, which introduces a higher probability of litigation risks. The company’s strategic focus on marketing these products under the 503A personalization exemption could lead to legal challenges. Furthermore, although new product releases and geographic expansions are positive developments, they are unlikely to contribute significantly to growth in 2025, putting further pressure on the company’s full-year guidance. These factors combined contribute to the Sell rating by Allen Lutz.
In another report released on July 9, Citi also reiterated a Sell rating on the stock with a $30.00 price target.