Hims & Hers Health Inc

HIMS

Hims & Hers Health Inc

@darius
• 1 year ago

Hims & Hers Earnings Recap: When 95% Growth Isn't Enough

Looking into making an investment here, the market rallied HIMS irrationally huge on a successful superbowl ad, as well as strong earnings, then overreacted on bad news regarding GLP-1

The key takeaways from the Hims & Hers earnings report include:

  1. Strong Financial Performance:

    • $481 million in revenue for the quarter and $1.5 billion for the full year, representing 95% year-over-year growth.

    • Net income of $26 million for the quarter and $126 million for the year.

    • Positive operating cash flow and free cash flow.

  2. Subscriber Growth:

    • Subscriber base continues to grow steadily with a 59% compound annual growth rate (CAGR).

    • Monthly online revenue per average subscriber increased to $73 in Q4, with management expecting further increases.

  3. Impact of GLP-1s:

    • GLP-1s contributed $225 million in revenue in 2024 but will likely phase out by the end of Q1 2025.

    • Despite this, management projects $725 million from the weight loss category overall in 2025, indicating that other treatments will sustain revenue growth.

  4. Future Outlook:

    • Q1 2025 revenue guidance of $520-$540 million, implying ~90% year-over-year growth.

    • Management remains optimistic about continued growth beyond the GLP-1 phase-out.

  5. Strategic Initiatives:

    • Expansion into new areas such as low testosterone (Low T), menopause treatments, mental health (PTSD, insomnia, substance abuse), and dermatology.

    • Leveraging advanced diagnostics and AI for personalized healthcare solutions.

    • Recent acquisitions, including peptide and lab testing facilities, to strengthen in-house capabilities.

  6. Valuation and Investment Perspective:

    • The stock is volatile, dropping 18% after hours despite strong results.

    • Enterprise Value to Sales (EV/Sales) multiple is approximately 8.8, with a forward basis of 5.4—considered a reasonable valuation for a company growing over 40% excluding GLP-1s.

    • Management is focused on increasing operating leverage and profitability.

Overall, the company is positioning itself as a diversified health platform beyond just GLP-1 treatments, with significant growth potential in multiple healthcare verticals.

https://www.youtube.com/watch?v=uzpu4MIsRXk