Hims & Hers Health (HIMS) Fell Due to Increased Regulatory Challenges

Maple Tree Capital, an investment management company, released its Q3 2025 investor letter. A copy of the letter can be downloaded here. The third quarter was mixed for Maple Tree Capital. The market continued to rebound from the Liberation Day lows, while the firm’s performance was affected by the late-quarter decline of one of its largest holdings, Upstart. This resulted in the Jonagold portfolio concluding the quarter with a 13.12% loss. On the other hand, its Heartwood portfolio delivered an exceptional quarter, gaining 40.2%, driven by the strong performance of its new holdings. Heartwood's return has exceeded 100% since its inception in 2023, greatly surpassing the S&P 500's 82% return during the same period. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Maple Tree Capital highlighted stocks such as Hims & Hers Health, Inc. (NYSE:HIMS). Hims & Hers Health, Inc. (NYSE:HIMS) offers a telehealth platform that connects consumers to licensed healthcare professionals. The one-month return of Hims & Hers Health, Inc. (NYSE:HIMS) was -6.09%, and its shares gained 41.03% of their value over the last 52 weeks. On December 29, 2025, Hims & Hers Health, Inc. (NYSE:HIMS) stock closed at $34.10 per share, with a market capitalization of $7.763 billion.

Maple Tree Capital stated the following regarding Hims & Hers Health, Inc. (NYSE:HIMS) in its third quarter 2025 investor letter:

"We sold our position in Hims & Hers Health, Inc. (NYSE:HIMS) this quarter following what we believe are increased regulatory risks to the business. Not only have GLP-1s (weight-loss drugs) become more challenging and competitive, but Hims and Hers core telehealth business (having NPs prescribe anti-depressant and other medication) appears more shaky than we initially believed. We sold our (small) position near $52 to reallocate into Upstart near $70. While the initial impact of this trade to performance has been unfavorable, we do believe this will boost long-term performance."

Hims & Hers Health, Inc. (NYSE:HIMS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 35 hedge fund portfolios held Hims & Hers Health, Inc. (NYSE:HIMS) at the end of the third quarter, up from 34 in the previous quarter. In the third quarter of 2025, Hims & Hers Health, Inc. (NYSE:HIMS) reported a 49% year-over-year increase in revenue, reaching nearly $600 million, with adjusted EBITDA margins exceeding 13%. While we acknowledge the potential of Hims & Hers Health, Inc. (NYSE:HIMS) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Hims & Hers Health, Inc. (NYSE:HIMS) and shared a bullish thesis on the company. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.