Leadership Moves and Market Jitters at Hims & Hers

Shares of Hims & Hers Health (NYSE: HIMS) experienced a significant downturn this week, plunging more than 10%. This sell-off was triggered by a substantial insider transaction in which Chief Executive Officer Andrew Dudum disposed of company stock valued at approximately $11 million. The timing of this move is raising questions among investors, as it coincides with both upcoming quarterly results on November 3 and increasing regulatory scrutiny concerning the company’s advertising for GLP-1 weight-loss medications.

Executive Suite Reshuffle

The leadership team is undergoing a notable transformation. In a surprising development, Chief Operating Officer Nader Kabbani, who joined the company as recently as May 2025, is transitioning to an advisory role effective November 2. His tenure lasted a mere six months. Simultaneously, Mike Chi, the Chief Commercial Officer who has been with the organization since 2021, is being promoted to fill the COO position. This executive realignment is occurring during a critical expansion phase for the digital health provider.

Robust Fundamentals Meet Lofty Valuation

From a fundamental perspective, the company’s performance remains strong. For the second quarter of 2025, revenue surged 73% to $544.8 million. Net income reached $42.5 million, with adjusted EBITDA coming in at $82.2 million. The subscriber base continues its upward trajectory, growing 31% year-over-year to surpass 2.4 million users. The full-year revenue guidance for 2025 remains unchanged at $2.30 to $2.40 billion.

However, the company’s valuation metrics are stretching well beyond industry norms. A price-to-book ratio of 22 significantly outpaces the sector average of 3. Furthermore, an EV/EBITDA multiple of 76 dwarfs the median sector valuation of 14, indicating a substantial growth premium priced into the shares.

Should investors sell immediately? Or is it worth buying Hims & Hers Health Registered (A)?

Regulatory Hurdles and Growth Initiatives

The U.S. Food and Drug Administration has recently issued warnings to Hims & Hers regarding “false and misleading” claims on its website related to weight-loss drugs. This regulatory pressure is not isolated to the company, as other telehealth providers have also received similar communications.

Despite this regulatory friction, the firm is pushing forward with its weight management portfolio. It has secured partnerships for Eli Lilly’s Tirzepatid and plans to launch a generic version of Novo Nordisk’s Liraglutid in 2025. This strategy is part of a broader effort to diversify its product offerings beyond compounded medications. A key growth driver is the new menopause vertical within the “Hers” division, which the company projects will achieve billion-dollar status by 2026, representing over one-third of anticipated total revenue.

All Eyes on the Upcoming Earnings Report

Market experts are forecasting third-quarter earnings per share between $0.08 and $0.09, an improvement from the $0.06 reported for the same period last year. The current consensus analyst rating is “Hold,” with price targets displaying a wide dispersion from $48.7 to $85. This broad range underscores the divergent views on whether the company’s premium valuation is justified.

The November 3rd earnings release is highly anticipated. Investors will be listening intently for management’s commentary on the recent leadership changes, the progress of the menopause service launch, and any potential revisions to the full-year outlook.