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In the last reported quarter, the company’s earnings per share (EPS) of 6 cents surpassed the Zacks Consensus Estimate by 20%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on three occasions and missed once, delivering an earnings surprise of 71.7%, on average.
For third-quarter 2024, the Zacks Consensus Estimate for revenues is pegged at $384.2 million, implying an improvement of 69.5% from the prior-year quarter’s reported figure. The consensus estimate for EPS is pegged at 6 cents, indicating an improvement from the prior-year period’s loss of 4 cents per share.
HIMS Estimate Movement
Earnings estimates for Hims & Hers’ 2024 earnings have remained flat at 22 cents in the past 60 days.
Image Source: Zacks Investment Research
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Let’s check out the factors that have shaped HIMS’ performance prior to this announcement.
Factors to Note Before Hims & Hers Reports
Hims & Hers is consistently witnessing strong market acceptance of its range of curated health and wellness products and services over the past few months. The company ended the second quarter of 2024 with nearly 1.9 million subscribers (up 43% year over year), adding more than 155,000 net new users to the platform. More than 40% of subscribers in the second quarter were utilizing a personalized solution, representing close to a 30-point increase in two years. Per management, an evolving portfolio of personalized offerings that providers can utilize to meet the unique needs of individual consumers was a key catalyst behind this expansion. These tailwinds are likely to have been key drivers for HIMS’ top-line growth in the upcoming quarter as they continue to boost the company’s total orders and average value per order.
On the second-quarter earnings call in August, management stated that the company expanded the capabilities of its weight loss specialty by launching compounded GLP-1s across 21 states in the quarter through a partnership with an FDA-registered 503(b) facility. Since then, HIMS has expanded access to the offering to more than 30 states, covering more than 60% of the U.S. population. Management anticipates nationwide availability before the year ends. This looks promising for the company’s third-quarter performance.
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 -11.42%. 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 111.6%. The stock has outperformed the Medical Info Systems’ 48.8% decline. HIMS shares also outperformed the Zacks Medical sector’s increase of 2.1% and the S&P 500’s rise of 20%.
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 2.2X, a discount to the industry's average of 3X. The company is also trading at a significant discount to other industry players like Inspire Medical Systems, Inc. (INSP - Free Report) , with its current P/S being 6.3X, Axonics, Inc. , whose current P/S is 6.9X, and Phreesia, Inc. (PHR - Free Report) , whose current P/S is 2.3X. This suggests that investors may be paying a lower price relative to the company's expected sales growth.
Image Source: Zacks Investment Research
Long-Term Investment Visibility
Hims & Hers is likely to continue its strong performance in the rest of 2024 on the back of continued growth in the company’s net subscribers. On the second-quarter earnings call, management stated that it was optimistic about its product offerings, including recent launches.
In September, HIMS announced access to the most common compounded GLP-1 subscriptions for $99 monthly for eligible U.S. military, veterans, teachers, nurses and first responders. This is likely to aid the company’s revenues going forward.
Hims & Hers is making investments in the expansion of personalized offerings, which is likely to increase in the second half of the year. Management expects to launch access to new multi-condition treatments, with a particular focus on those that are interspecialty or enable expansion into adjacent markets.
On the second-quarter earnings call, management stated that the company had recently signed an agreement to purchase an FDA-registered 503(b) facility. HIMS believes that over the long term, the acquisition will likely present additional opportunities across specialties such as hormonal therapy and other treatments that require sterile compounded medications. In the near term, the buyout is expected to further enhance the durability of its supply chain for compounded GLP-1s and positions the company to improve accessibility as it verticalizes these operations.
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 are 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 superior performance expectations compared with its industry and sector peers. It is still valued lower than the broader market, which suggests potential room for growth if it can align more closely with overall market performance. As the chances of beating estimates are unlikely, it would be unwise to add the stock to one’s portfolio before the earnings release. However, if investors are already holding the stock, it would be prudent to hold on to it at present. The favorable Zacks Style Score of A suggests continued uptrend potential for HIMS.
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Image: Bigstock
HIMS Q3 Estimates Unchanged Before Earnings: How to Play the Stock?
Hims & Hers Health, Inc. (HIMS - Free Report) is scheduled to report third-quarter 2024 results on Nov. 4, after the closing bell.
In the last reported quarter, the company’s earnings per share (EPS) of 6 cents surpassed the Zacks Consensus Estimate by 20%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on three occasions and missed once, delivering an earnings surprise of 71.7%, on average.
For third-quarter 2024, the Zacks Consensus Estimate for revenues is pegged at $384.2 million, implying an improvement of 69.5% from the prior-year quarter’s reported figure. The consensus estimate for EPS is pegged at 6 cents, indicating an improvement from the prior-year period’s loss of 4 cents per share.
HIMS Estimate Movement
Earnings estimates for Hims & Hers’ 2024 earnings have remained flat at 22 cents in the past 60 days.
Image Source: Zacks Investment Research
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Let’s check out the factors that have shaped HIMS’ performance prior to this announcement.
Factors to Note Before Hims & Hers Reports
Hims & Hers is consistently witnessing strong market acceptance of its range of curated health and wellness products and services over the past few months. The company ended the second quarter of 2024 with nearly 1.9 million subscribers (up 43% year over year), adding more than 155,000 net new users to the platform. More than 40% of subscribers in the second quarter were utilizing a personalized solution, representing close to a 30-point increase in two years. Per management, an evolving portfolio of personalized offerings that providers can utilize to meet the unique needs of individual consumers was a key catalyst behind this expansion. These tailwinds are likely to have been key drivers for HIMS’ top-line growth in the upcoming quarter as they continue to boost the company’s total orders and average value per order.
On the second-quarter earnings call in August, management stated that the company expanded the capabilities of its weight loss specialty by launching compounded GLP-1s across 21 states in the quarter through a partnership with an FDA-registered 503(b) facility. Since then, HIMS has expanded access to the offering to more than 30 states, covering more than 60% of the U.S. population. Management anticipates nationwide availability before the year ends. This looks promising for the company’s third-quarter performance.
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 -11.42%. 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 #3. 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 111.6%. The stock has outperformed the Medical Info Systems’ 48.8% decline. HIMS shares also outperformed the Zacks Medical sector’s increase of 2.1% and the S&P 500’s rise of 20%.
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 2.2X, a discount to the industry's average of 3X. The company is also trading at a significant discount to other industry players like Inspire Medical Systems, Inc. (INSP - Free Report) , with its current P/S being 6.3X, Axonics, Inc. , whose current P/S is 6.9X, and Phreesia, Inc. (PHR - Free Report) , whose current P/S is 2.3X. This suggests that investors may be paying a lower price relative to the company's expected sales growth.
Image Source: Zacks Investment Research
Long-Term Investment Visibility
Hims & Hers is likely to continue its strong performance in the rest of 2024 on the back of continued growth in the company’s net subscribers. On the second-quarter earnings call, management stated that it was optimistic about its product offerings, including recent launches.
In September, HIMS announced access to the most common compounded GLP-1 subscriptions for $99 monthly for eligible U.S. military, veterans, teachers, nurses and first responders. This is likely to aid the company’s revenues going forward.
Hims & Hers is making investments in the expansion of personalized offerings, which is likely to increase in the second half of the year. Management expects to launch access to new multi-condition treatments, with a particular focus on those that are interspecialty or enable expansion into adjacent markets.
On the second-quarter earnings call, management stated that the company had recently signed an agreement to purchase an FDA-registered 503(b) facility. HIMS believes that over the long term, the acquisition will likely present additional opportunities across specialties such as hormonal therapy and other treatments that require sterile compounded medications. In the near term, the buyout is expected to further enhance the durability of its supply chain for compounded GLP-1s and positions the company to improve accessibility as it verticalizes these operations.
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 are 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 superior performance expectations compared with its industry and sector peers. It is still valued lower than the broader market, which suggests potential room for growth if it can align more closely with overall market performance. As the chances of beating estimates are unlikely, it would be unwise to add the stock to one’s portfolio before the earnings release. However, if investors are already holding the stock, it would be prudent to hold on to it at present. The favorable Zacks Style Score of A suggests continued uptrend potential for HIMS.