📉 Hims & Hers shares fall by more than 20%!
Shares of Hims & Hers Health $HIMS plummeted by more than 30 %, even though the company reported year-over-year revenue growth of 95 % to $481 million, beating Wall Street' s expectations . Important, however, were weaker gross margins and news that the company will likely discontinue sales of compounded semaglutide (a diabetes drug), which was one of the key drivers of growth in 2024.

Hims & Hers Health is a fast-growing telemedicine company that provides online medical consultations and prescribes customized treatments in areas such as weight loss, skin care, mental health and more. Their model allows patients to get prescriptions and treatment completely online.

📊 Key numbers for Q4 2024:
Earnings per share (EPS): 11 cents (vs. expectations of 10 cents)

Revenue: $481 million (vs. expectations of $470 million)

Revenue growth vs. Q4 2023: +95%

Non-GDP-1 product revenue: $1.2 billion (+43% YoY)

Net profit: USD 26 million (vs. USD 1.25 million a year ago)

Gross margin: 77% (vs. expectations of 78.4%)

What caused the sell-off?
The loss of a key drug: FDA announced that the shortage of injectable semaglutide has been resolved, meaning that alternative compounded drugs will be regulated and likely pulled from the market. Hims & Hers has confirmed that by the end of Q1 2025 it will cease offering this product.

Gross margin weakening: expected margin 78,4 %, but the company only achieved 77 %, signaling higher drug sales costs and pressure on profitability.

Strong correction after previous growth: the company's shares rose by more than 200 %, and many investors are realizing gains in response to uncertainty about future growth.

🔮 What are the prospects for 2025?
Expected Q1 2025 earnings: USD 520-540 million (expectations were USD 497 million)

Expected adjusted earnings: USD 55-65 million

New Products: The company plans to launch a generic version of liraglutide, which could replace the shortfall of semaglutide.

Hims & Hers is still looking to expand - its sales outside the GLP-1 segment (skin care, hair care, mental health) grew by 43 % to $1.2 billion, as the company looks to diversify its portfolio.

🔥 What do you think, will this company's stock continue to rocket or is the growth over?
Does anyone have shares of this company in their portfolio?