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In the last reported quarter, the company’s earnings per share (EPS) of 5 cents surpassed the Zacks Consensus Estimate by 150%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on three occasions and missed once, delivering an earnings surprise of 79.2%, on average.
For second-quarter 2024, the Zacks Consensus Estimate for revenues is pegged at $304.7 million, implying an improvement of 46.6% from the prior-year quarter’s reported figure. The consensus estimate for EPS is pegged at 5 cents, indicating a surge of 266.7% from the prior-year period’s reported number.
Estimate Movement
Earnings estimates for Hims & Hers’ 2024 earnings have moved 11.1% north to 20 cents in the past 60 days.
Image Source: Zacks Investment Research
Let’s check out the factors that have shaped HIMS’ performance prior to this announcement.
Factors to Note
Hims & Hers is consistently witnessing strong market acceptance of its range of curated health and wellness products and services over the past few months. On the first quarter of 2024 earnings call in May, management commented that the strong execution of the company’s strategy is increasingly drawing more consumers to its platform. In the first quarter, subscribers grew by a record 172,000 quarter-over-quarter to more than 1.7 million.
Per management, personalization continues to attract users. The number of subscribers opting for personalized subscriptions has nearly tripled over the last year, representing just approximately 35% of subscribers on the platform. This momentum is likely to have continued in the second quarter, thereby driving up the revenues.
On the same call, management was hopeful about the potential of the recently launched Sex Rx + Climax Control. This, along with its other offerings like Heart Health by Hims and Hard Mints, is likely to have witnessed robust adoption by subscribers during the to-be-reported quarter, thereby driving up the revenues.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), along with a positive Earnings ESP, has higher chances of beating estimates. This is not the case here, as you can see below.
Earnings ESP: Hims & Hers has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Shares Outperform Industry, Underperforms Sector and S&P
Year to date, shares of Hims & Hers have gained 147.5%. The stock has outperformed the Medical Info Systems’ 13.8% decline. HIMS shares also outperformed the Zacks Medical sector’s increase of 5.9% and the S&P 500’s rise of 14.8%.
YTD Price Comparison
Image Source: Zacks Investment Research
Key Valuation Metric
From a valuation standpoint, Hims & Hers’ forward 12-month price-to-sales (P/S) is 3.1X, a premium to the industry's average of 1.4X. The company is also trading at a significant premium to other industry players like Enovis Corporation (ENOV - Free Report) , with its current P/S being 1.2X, Sonendo, Inc. (SONX - Free Report) , whose current P/S is 0.2X, and P3 Health Partners Inc. (PIII - Free Report) , whose current P/S is 0.1X. This suggests that investors may be paying a higher price relative to the company's expected sales growth.
Price-to-Sales Forward Twelve Months (F12M)
Image Source: Zacks Investment Research
Long-Term Investment Visibility
Hims & Hers is likely to continue with its strong performance in 2024 on the back of continued growth in the company’s net subscribers. On the first-quarter earnings call, management was optimistic about its product offerings, including recent launches.
Management believes that partnerships with leading medical institutions and experts within each of Hims & Hers’ specialties enable it to provide access to customized clinical solutions that are designed with a focus on safety and efficacy. This allows providers on the company’s platform to meet their patients' clinical needs at an individual level, targeting things like side effects and adherence through personalized dosages, a variety of product form factors to drive adherence and the ability to address multiple health conditions with one solution.
Hims & Hers’ infrastructure and scale also provide it with the ability to equip providers with the breadth of personalized treatment options at mass market prices. Continued expansion and refinement of its personalized portfolio will be a critical component behind its success in 2024 and beyond, per management. The company also aims to improve the customer experience in areas like weight loss and dermatology with more user-friendly form factors and, eventually, a broader selection of multi-action offerings.
Our Final Take
There is no denying that Hims & Hers sits favorably in terms of core business strength, earnings prowess, robust financial footing and global opportunities. The stock’s strong core growth prospects present a good reason for existing investors to retain shares for potential future gains.
For those exploring to make new additions to their portfolios, the valuation indicates expectations of superior performance compared with its industry and sector peers. However, as it is still valued lower than the broader market, it suggests potential room for growth if it can align more closely with overall market performance.
Image: Bigstock
Should You Buy Hims & Hers (HIMS) Stock Ahead of Q2 Earnings?
Hims & Hers Health, Inc. (HIMS - Free Report) is scheduled to report second-quarter 2024 results on Aug 5, after the closing bell.
In the last reported quarter, the company’s earnings per share (EPS) of 5 cents surpassed the Zacks Consensus Estimate by 150%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on three occasions and missed once, delivering an earnings surprise of 79.2%, on average.
For second-quarter 2024, the Zacks Consensus Estimate for revenues is pegged at $304.7 million, implying an improvement of 46.6% from the prior-year quarter’s reported figure. The consensus estimate for EPS is pegged at 5 cents, indicating a surge of 266.7% from the prior-year period’s reported number.
Estimate Movement
Earnings estimates for Hims & Hers’ 2024 earnings have moved 11.1% north to 20 cents in the past 60 days.
Image Source: Zacks Investment Research
Let’s check out the factors that have shaped HIMS’ performance prior to this announcement.
Factors to Note
Hims & Hers is consistently witnessing strong market acceptance of its range of curated health and wellness products and services over the past few months. On the first quarter of 2024 earnings call in May, management commented that the strong execution of the company’s strategy is increasingly drawing more consumers to its platform. In the first quarter, subscribers grew by a record 172,000 quarter-over-quarter to more than 1.7 million.
Per management, personalization continues to attract users. The number of subscribers opting for personalized subscriptions has nearly tripled over the last year, representing just approximately 35% of subscribers on the platform. This momentum is likely to have continued in the second quarter, thereby driving up the revenues.
On the same call, management was hopeful about the potential of the recently launched Sex Rx + Climax Control. This, along with its other offerings like Heart Health by Hims and Hard Mints, is likely to have witnessed robust adoption by subscribers during the to-be-reported quarter, thereby driving up the revenues.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), along with a positive Earnings ESP, has higher chances of beating estimates. This is not the case here, as you can see below.
Earnings ESP: Hims & Hers has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares Outperform Industry, Underperforms Sector and S&P
Year to date, shares of Hims & Hers have gained 147.5%. The stock has outperformed the Medical Info Systems’ 13.8% decline. HIMS shares also outperformed the Zacks Medical sector’s increase of 5.9% and the S&P 500’s rise of 14.8%.
YTD Price Comparison
Image Source: Zacks Investment Research
Key Valuation Metric
From a valuation standpoint, Hims & Hers’ forward 12-month price-to-sales (P/S) is 3.1X, a premium to the industry's average of 1.4X. The company is also trading at a significant premium to other industry players like Enovis Corporation (ENOV - Free Report) , with its current P/S being 1.2X, Sonendo, Inc. (SONX - Free Report) , whose current P/S is 0.2X, and P3 Health Partners Inc. (PIII - Free Report) , whose current P/S is 0.1X. This suggests that investors may be paying a higher price relative to the company's expected sales growth.
Price-to-Sales Forward Twelve Months (F12M)
Image Source: Zacks Investment Research
Long-Term Investment Visibility
Hims & Hers is likely to continue with its strong performance in 2024 on the back of continued growth in the company’s net subscribers. On the first-quarter earnings call, management was optimistic about its product offerings, including recent launches.
Management believes that partnerships with leading medical institutions and experts within each of Hims & Hers’ specialties enable it to provide access to customized clinical solutions that are designed with a focus on safety and efficacy. This allows providers on the company’s platform to meet their patients' clinical needs at an individual level, targeting things like side effects and adherence through personalized dosages, a variety of product form factors to drive adherence and the ability to address multiple health conditions with one solution.
Hims & Hers’ infrastructure and scale also provide it with the ability to equip providers with the breadth of personalized treatment options at mass market prices. Continued expansion and refinement of its personalized portfolio will be a critical component behind its success in 2024 and beyond, per management. The company also aims to improve the customer experience in areas like weight loss and dermatology with more user-friendly form factors and, eventually, a broader selection of multi-action offerings.
Our Final Take
There is no denying that Hims & Hers sits favorably in terms of core business strength, earnings prowess, robust financial footing and global opportunities. The stock’s strong core growth prospects present a good reason for existing investors to retain shares for potential future gains.
For those exploring to make new additions to their portfolios, the valuation indicates expectations of superior performance compared with its industry and sector peers. However, as it is still valued lower than the broader market, it suggests potential room for growth if it can align more closely with overall market performance.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.