Hims & Hers Health, Inc. (HIMS): A Bull Case Theory

We came across a bullish thesis on Hims & Hers Health, Inc. (HIMS) on Substack by Oliver | MMMT Wealth. In this article, we will summarize the bulls’ thesis on HIMS. Hims & Hers Health, Inc. (HIMS)'s share was trading at $52.35 as of May 7^th. HIMS’s trailing and forward P/E were 76.99 and 86.21 respectively according to Yahoo Finance.

Hims & Hers (HIMS) just posted a quarter that can only be described as a breakout moment, with growth rates across key financial metrics that rival some of the most explosive periods in tech history. The company delivered 111% year-over-year revenue growth, the highest since going public, alongside a 345% increase in net income, 182% rise in adjusted EBITDA, 322% operating cash flow growth, and a staggering 321% surge in free cash flow. These numbers are not just strong—they are rare in the public markets, especially for a company trading at just 3.7x next-twelve-month sales. When you compare this level of growth with peers above a $5 billion market cap, HIMS stands almost alone, with only a handful of names like Coinbase or Rocket Lab showing comparable revenue acceleration—none of which match the free cash flow expansion HIMS is delivering. From a fundamentals standpoint, HIMS is executing at a level reminiscent of Nvidia’s 2022-2023 AI-fueled surge, even if at a smaller scale. The company’s CAGR since Q1 2022 now sits at 76%, precisely matching Nvidia’s over that same time frame, and it’s doing so while disrupting the entrenched, slow-moving healthcare industry—not simply riding a macro wave like AI.

The quarter’s results show a business model that is gaining momentum. Revenue growth actually accelerated from 95% in the previous quarter and 51% the quarter before that, suggesting HIMS is not just scaling, but doing so more efficiently and profitably. One of the key drivers was a 53% increase in monthly revenue per subscriber—a critical signal that users are adopting more personalized, higher-margin offerings. This increase stems from better cross-selling, deeper personalization, and broader product adoption. Over 1.4 million of the company’s 2.4 million subscribers—58.3%—are now using personalized solutions, up from just 21.9% two years ago, and 80% of dermatology users are on these plans. As HIMS continues to expand its diagnostic capabilities, particularly with the Trybe acquisition enabling blood testing and further personalization, this figure is likely to climb further. Management cautioned that the monthly revenue figure may dip slightly in Q2, but the long-term trajectory remains firmly upward.

One standout growth engine is the oral weight loss product, which posted 300% YoY growth, confirming that HIMS is far more than just a GLP-1 story. With nearly 100 million Americans struggling with obesity, the total addressable market here is massive—and HIMS’s lower-cost oral solution (about two-thirds the price of branded GLP-1s) positions it competitively. Meanwhile, retention continues to improve, supported by the success of personalized subscriptions, which are inherently stickier and more valuable over time. Management’s long-term outlook is equally ambitious, with guidance for $6.5 billion in revenue and $1.3 billion in adjusted EBITDA by 2030, representing a 21% and 28% CAGR, respectively. If achieved, and applying a 40x EBITDA multiple (reasonable for a high-growth, high-margin disruptor), that translates into a $52 billion market cap—or a $230 stock price, more than 5x today’s value. Even at a 30x multiple, the implied valuation would be $39 billion, or roughly $170 per share.

HIMS also continues to demonstrate discipline on the profitability front. Operating cash flow came in at $109 million with $50 million in free cash flow, nearly covering the entire $59 million CapEx spend in the quarter. Gross margin stood at 73%, slightly below estimates due to mix shift toward lower-margin GLP-1s, but is expected to rebound as economies of scale and product diversification play out. EBITDA margin climbed to 16% this quarter, and while FY25 guidance suggests a pullback to 13%, the long-term trajectory toward 20% appears conservative. Importantly, HIMS is showing that it can fund growth internally, with efficient customer acquisition and improving unit economics. Even after rounding down metrics in a screener—100% revenue growth, 100% FCF growth, and 10% EBITDA margins—HIMS remains essentially unmatched in the market today.

Looking ahead, global expansion is another major opportunity. The company has just launched in the UK, where the broken state of the NHS and high private care costs create a ripe environment for HIMS’s direct-to-consumer, value-based model. With limited local competition and high demand for affordable, accessible care, HIMS could replicate its U.S. success internationally. Altogether, this quarter confirmed HIMS as a rare public-market disruptor—high-growth, profitable, and trading at a steep discount to its long-term potential. The company is not just growing—it’s building a sustainable healthcare platform with an unmatched risk/reward profile.

Hims & Hers Health, Inc. (HIMS) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 38 hedge fund portfolios held HIMS at the end of the fourth quarter which was 31 in the previous quarter. While we acknowledge the risk and potential of HIMS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than HIMS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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