Shares of Hims & Hers Health (HIMS) climbed 9% on Wednesday after Canaccord Genuity raised its price target on the telehealth company, citing robust sales trends, momentum in its weight-loss segment, and increasing investor enthusiasm around its peptide pipeline.
Canaccord analyst Maria Ripps maintained a Buy rating and boosted her price target to $40 from $32, implying further upside from current levels. The upgrade follows a strong second quarter during which the stock gained roughly 67%.
Improving Business Fundamentals
Ripps noted that Hims & Hers continues to benefit from stronger credit card spending data and the rollout of branded weight-loss medications. The company has become one of Novo Nordisk's largest telehealth partners for weight-loss drugs. It also expanded internationally by launching generic semaglutide in Canada in late May and completed its acquisition of Eucalyptus in early June.
According to Canaccord, credit card spending data showed adjusted year-over-year sales growth improving throughout the quarter, rising from mid-to-high single digits in April to high teens by June. The company generated $2.37 billion in revenue over the last 12 months, with 33% revenue growth and a 73% gross profit margin.
Ripps also highlighted that improving sentiment around Hims' peptide strategy has become an additional positive catalyst for investors.
FDA Review Looms Over Peptide Opportunity
Investor attention is now turning to the US Food and Drug Administration's Pharmacy Compounding Advisory Committee meeting scheduled for July 23-24. The committee will review seven peptides after FDA staff recommended against allowing compounding pharmacies to manufacture them, citing limited evidence and unresolved safety concerns.
The peptides under review include BPC-157, Emideltide, Epitalon, KPV, MOTS-c, Semax, and TB-500. FDA scientists stated that available evidence was insufficient to support compounding and that potential safety risks could not be ruled out. Former advisory committee member Dr. Anita Gupta noted that earlier reviews identified concerns over immune responses, including immunogenicity risks, and warned about product quality issues such as heavy metals, microbial contamination, or mislabeling.
Despite the FDA staff recommendation, Ripps remains optimistic about the longer-term opportunity, noting that the advisory committee's current membership appears more supportive of peptides.
Analysts See Decision as Key Catalyst
Hims has already positioned itself for a potential expansion into peptide therapies. Earlier this year, the company acquired a California-based peptide manufacturing facility to strengthen its domestic supply chain and support future work in preventive health, metabolic optimization, cognitive performance, and recovery science. Several analysts believe the peptide market could represent a multibillion-dollar revenue opportunity if regulations become more favorable.
Needham analyst Ryan MacDonald described the FDA staff recommendation as unexpected but said it does not represent the final outcome. "This is not the end of the conversation," he told the Hims House investor community on X, adding that approval odds may be "slightly less," but he is "still operating under the assumption that they will get approved." MacDonald noted that the advisory committee must still review scientific evidence, hear stakeholder feedback, and make its recommendation before the FDA issues a final decision. He also said FDA leadership ultimately determines the outcome, while the Department of Health and Human Services oversees the agency, with Health Secretary Robert F. Kennedy Jr. having publicly expressed support for peptide deregulation.
For broader market context, see our coverage of Stoxx 600 Hits Record 653 as BofA Lifts Year-End Target to 630 on Growth Hopes and Nasdaq Futures Slide Ahead of Payrolls; Tech Weakness, Fed Uncertainty Weigh.
This article is for informational purposes only and does not constitute financial advice.
