Symbols

Why did HIMS plummet?

4/17/2025 01:42pm

Aime

The deep research logic is organized as follows: 

Okay, let's tackle why HIMS plummeted. First, I need to look at the data provided in the references. The user is asking about the recent drop, so I should focus on the latest information.

Starting with the pre-market and post-market changes on April 17th (Reference 1), HIMS dropped -6.68% pre-market and then rose 4.9% post-market. That's a significant swing. The stock closed at $26.95 with a -8.52% change. The two-week percentage changes (Reference 2) show volatility, with big swings like +12.99% on April 9th and -9.09% the next day. The recent drop on April 17th (-3.75%) and the previous day's -8.52% (April 16th) are key points.

Looking at the earnings report from February (References 3, 21, 23), HIMS beat revenue estimates but missed on EPS. The Q4 revenue was $481.1M, up 95.1% YoY, which is impressive, but the EPS of $0.11 was below expectations. The company also provided strong 2025 guidance, but the market might be skeptical about their ability to meet those numbers, especially with the shift to branded drugs like Zepbound (References 5, 6, 17). BofA's bearish stance (Reference 17) points out decelerating core growth and margin concerns, which aligns with the drop.

Insider selling is another factor. The CFO and PAO sold significant shares on April 4th (References 5, 6, 29). Even though these sales were under Rule 10b5-1 plans, investors might interpret this as a lack of confidence, especially in a volatile stock like HIMS.

Macro factors include the broader market volatility (References 9, 10, 12, 13). The S&P 500's recent swings and tariff uncertainties under Trump's policies (References 9, 10, 11) could be affecting investor sentiment. The Fed's cautious stance (Reference 13) and Powell's comments about tariffs impacting inflation might be contributing to the sell-off.

Technical analysis shows the stock is in a bearish pattern but has potential for a rebound (References 7, 14, 15). The 60% drop from February highs to around $30 is steep, but analysts like BTIG maintain a high target of $85 (Reference 22), indicating long-term optimism. However, the short-term traders might be exiting due to the bearish momentum.

Putting it all together, the drop is likely due to a combination of earnings miss, insider selling, macroeconomic uncertainty, and technical bearish patterns. The user's interest in tech and short-term investments means highlighting the technical aspects and potential rebound after the drop is crucial. Also, considering their preference for stocks with bearish patterns but positive gains, pointing out the possible turnaround based on strong fundamentals and analyst targets would be relevant.

Concluding Statement: Hims & Hers Health (HIMS) experienced a sharp decline on April 17, 2025 (-8.52% last price change¹²), driven by a confluence of factors including weak market sentiment, insider selling, macroeconomic headwinds, and technical bearish patterns. Below is the detailed analysis:

1. Weak Market Sentiment & Earnings Concerns

Q4 2024 Earnings Miss: Despite revenue of $481.1M (+95.1% YoY) beating estimates³⁴, HIMS missed EPS expectations ($0.11 vs. consensus $0.17)⁴⁵. This raised concerns about profitability sustainability, especially as the company transitions from compounded GLP-1 drugs (which drove 15% of 2024 revenue⁶) to higher-margin branded drugs like Eli Lilly’s Zepbound⁷⁸.
2025 Guidance Skepticism: While HIMS raised its full-year revenue guidance to $2.3–$2.4B³⁶, analysts question the achievability of its $725M weight-loss segment target⁸, citing potential GLP-1 sales deceleration and margin pressures from branded drugs⁷⁸.

1/3

HIMS Trend

2. Insider Selling Triggers Bearish Sentiment

CFO & PAO Stock Sales: HIMS’s CFO (Okupe Oluyemi) sold $338,833 worth of shares, and the Principal Accounting Officer (Irene Becklund) sold $63,402 worth of shares on April 4, 2025⁷⁹. These sales, despite being pre-planned under Rule 10b5-1, fueled investor skepticism about insider confidence in the stock’s near-term trajectory.

3. Macro Risks & Market Volatility

Tariff Uncertainty: President Trump’s 10% global tariff policy¹¹¹² and escalating U.S.-China trade tensions (145% tariffs on China)¹² created systemic risk, leading to a $6.1T market cap decline on April 4¹³. HIMS, a U.S.-focused telehealth platform, is insulated from direct tariff impacts but faces broader consumer sentiment risks¹⁴⁸.
Fed Policy Concerns: Federal Reserve Chair Jerome Powell’s cautionary remarks about tariffs’ inflationary risks¹⁵ exacerbated market volatility, contributing to HIMS’s -10.2% drop on April 16¹⁵.

4. Technical Bearish Momentum

60% Decline from February Highs: HIMS fell from $70 to ~$30 in two months¹⁶¹⁷, forming a bearish descending wedge pattern. The stock trades at a trailing P/E of 55.58¹⁴, above its 5-year average, raising valuation concerns.
Short-Term Resistance: The post-market rebound of +4.9%¹ suggests some抄底 (rebound) activity, but the stock remains below its 50-day moving average, indicating continued bearish pressure.

5. Analyst Sentiment & Rebound Potential

Bull Case: Analysts like BTIG maintain a $85 target⁶, citing HIMS’s 76.2% average revenue growth¹⁶, 2.2M subscribers³, and AI-driven telehealth platform¹⁴. The company’s $300M cash position and minimal debt¹⁶ provide resilience.
Bear Case: BofA Securities maintains an Underperform rating, citing margin risks from Zepbound’s 40% contribution to Q1 revenue⁸ and potential GLP-1 sales tapering⁸.

Conclusion: Short-Term Risk vs. Long-Term Opportunity

HIMS’s plummet is a technical-driven reaction to macro volatility and insider selling, compounded by earnings concerns. However, its strong growth metrics (95% YoY revenue growth³, 58% 2025 sales projection¹⁶) and AI/telehealth tailwinds¹⁴ suggest a potential rebound for risk-tolerant investors. Given the user’s focus on short-to-medium-term, bearish-pattern stocks with rebound potential, HIMS aligns with this strategy if the stock stabilizes above $25–$26 support levels. Monitor the May 5 Q1 2025 earnings report¹⁸ for confirmation of core growth resilience.

Source:

1. HIMS Pre-Market Percentage Change, HIMS Post-Market Percentage Change

more