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Why Hims & Hers Health (HIMS) Shares Are Dropping Today — And What It Really Means
The Quick Take
Hims & Hers Health (NYSE: HIMS) shares tumbled −6.8% this afternoon after Bank of America reaffirmed a Sell rating, warning that the company could miss third-quarter sales expectations.
The analyst cited three red flags:
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Weak September order growth (down 16% year-over-year)
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Higher customer-acquisition costs eating into margins
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Rising competition and regulatory risk
The stock closed the day at $59.16, down 5.8%, reversing much of yesterday’s rally after Hims unveiled a new menopause-care program that had sent shares up nearly 6%.
What Actually Happened
This wasn’t just another intraday dip. The move came directly after Bank of America’s cautious note, which hit retail investors like cold water after a hot streak.
Just 24 hours earlier, Hims was celebrated as a telehealth disruptor once again—launching personalized perimenopause and menopause treatments across its platform. The expansion introduced new prescription offerings like estradiol and progesterone in pill, patch, and cream form.
Investors loved it. Analysts called it Hims’ “next billion-dollar vertical.” But the skeptical analyst report flipped sentiment fast.
“We’re seeing weaker order trends and margin compression,” the report read. “Q3 targets now look optimistic given September order softness.”
Translation: the market suddenly worried that growth may be peaking just as marketing costs accelerate.
The Bigger Picture
HIMS has been one of 2025’s most volatile health-tech names.
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99 separate ±5% moves in the past 12 months
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+135% year-to-date, even after today’s drop
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Still 14% below its 52-week high of $68.74 (February 2025)
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A $1,000 investment five years ago would now be worth roughly $5,678
That kind of price behavior makes Hims a perfect example of momentum meeting mood swings.
Why Analysts Are Nervous
Let’s unpack the pressure points analysts keep emphasizing:
1. Customer-Acquisition Costs Are Rising
Telehealth has become a marketing battlefield. CACs (customer acquisition costs) have ballooned as competitors like Ro, Cerebral, and Herself Health target the same consumers. Each social ad and podcast sponsorship now costs more than last year.
2. Order Growth Is Slowing
September’s 16% year-over-year decline in orders is a yellow flag. Subscription renewals remain solid, but new-customer growth has slowed from Hims’ historical double-digit pace.
3. Margins Are Compressing
Hims has historically enjoyed 70–80% gross margins, but analysts caution these could shrink if marketing spend continues to grow faster than revenue.
4. Regulatory Risk Is Creeping In
Recent FDA reforms on compounding and telemedicine prescribing could affect Hims’ weight-loss and hormone products. Tightened rules could restrict flexibility in its product offerings.
The Market Loves a Panic
HIMS tends to overreact—both on the way up and on the way down. The company’s next earnings report will test whether this drop was justified or simply another sentiment swing.
Each sharp selloff in the past year has been followed by rebounds once traders refocus on fundamentals. Today’s slide might reflect emotional selling more than deteriorating business performance.
Under the Hood: What the Numbers Say
| Metric | Latest (Q2 2025) | Year-over-Year Change | Context |
|---|---|---|---|
| Revenue | $544.8 million | +73% | Slight miss versus $552 million consensus |
| Adjusted EBITDA Margin | ~13% | +150 bps | Expanding despite rising marketing costs |
| Subscribers | 1.7 million+ | +65% | Retention remains strong |
| Gross Margin | ~78% | Flat | Still industry-leading |
Source: Company filings, FactSet estimates.
These figures show a business still growing aggressively, not one in structural decline.
Why the Long Game Still Matters
Hims & Hers is evolving from a telehealth storefront into a vertically integrated digital-health ecosystem, combining medical consultations, prescriptions, and long-term care.
Its reach now includes:
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Hair loss treatments
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Sexual health care
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Mental health therapy
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Weight management and GLP-1 programs
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Hormone and menopause therapy
With over $2 billion in projected 2025 revenue, the company’s brand scale and recurring-subscription model give it leverage most competitors lack.
My Take: Volatility Does Not Equal Weakness
Here’s my objective read:
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Short term: The Bank of America note is a speed bump, not a wall.
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Medium term: Margin pressure is a valid concern, but not an existential one.
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Long term: If Hims executes its women’s-health expansion while maintaining subscriber retention, the stock’s growth story remains intact.
For traders, a consolidation around $55–$57 could represent a tactical entry point if sentiment stabilizes.
The Bottom Line
Today’s drop says less about Hims’ fundamentals and more about how quickly sentiment turns in momentum-driven markets. The company is still scaling fast, diversifying services, and holding enviable margins.
The story isn’t breaking—it’s just taking a breather.
DISCLAIMER: This analysis of the aforementioned stock security is in no way to be construed, understood, or seen as formal, professional, or any other form of investment advice. We are simply expressing our opinions regarding a publicly traded entity.
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