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Bank of America analyst Allen Lutz reiterated a Sell rating and $28 price target for Hims & Hers Health (HIMS) stock, citing weaker-than-expected core trends and limited upside relative to peers. The target price indicates a 55% downside potential from current levels. The company reported mixed Q2 results, with revenue below estimates but profits ahead of expectations. Lutz pointed out that growth in Hims' core business was weaker than expected, and investors will look for more clarity on how much of the company's growth is being driven by its recent acquisition of ZAVA.

Bank of America analyst Allen Lutz has reiterated his Sell rating on Hims & Hers Health (HIMS) stock, setting a price target of $28. This indicates a potential 55% downside from current levels [1]. The analyst's decision comes following the company's mixed second-quarter (Q2) results, which saw revenue fall short of estimates but profits exceed expectations.

Hims & Hers reported $544.8 million in revenue for Q2, missing both BofA's $554 million estimate and the Street consensus of $551.67 million. However, adjusted EBITDA came in at $82.2 million, well above forecasts. Despite the revenue miss, the company's GLP-1 drug sales hit $190 million, exceeding expectations [1].

Lutz highlighted that growth in Hims' core business was weaker than anticipated, which could be a concern for investors. Additionally, the analyst noted that the company's recent acquisition of ZAVA, a European telehealth firm, is expected to add at least $50 million in revenue in the second half of the year. However, Hims kept its full-year guidance unchanged at $2.3 to $2.4 billion, suggesting that growth in its core business may be slowing [1].

Investors should watch for more clarity on how much of Hims' growth is being driven by ZAVA versus its existing business operations. Other key issues to monitor include GLP-1 sales performance, customer acquisition, the integration of the ZAVA acquisition, and Hims' expansion into hormone therapy and the Canadian market [1].

Wall Street's outlook for HIMS stock remains cautious. The stock holds a Hold consensus rating, with one analyst recommending a Buy, seven rating it as Hold, and two issuing Sell ratings. The average price target over the next 12 months is $42.33, indicating a 33.18% decline from its current price of $63.35 [3].

References:
[1] https://www.tipranks.com/news/bank-of-america-sees-55-downside-ahead-for-hims-hers-health-stock-hims-post-q2-results
[2] https://www.benzinga.com/analyst-stock-ratings/analyst-color/25/08/46861750/hims-hers-health-posts-weak-q2-heading-into-more-near-term-challenges-analysts-say
[3] https://finbold.com/wall-street-sets-hims-stock-price-for-the-next-12-months/