Hims stock plunged Tuesday after the compounding pharmacy and IBD 50 newcomer issued a bullish outlook that still includes knockoff versions of semaglutide.
The Food and Drug Administration removed semaglutide from its drugs shortage list last week, meaning compounders will soon have to stop making copies of it. Semaglutide is the backbone behind Novo Nordisk's wildly popular diabetes and weight-loss drugs Ozempic and Wegovy.
Hims & Hers Health has sold compounded semaglutide for years, building a big business. The company now plans to skirt the FDA's decision by selling doses of semaglutide that Novo doesn't. Commercially available doses won't be available after the first quarter.
Compounders argue personalizing the doses could help patients avoid the gastrointestinal effects often tied to drugs like semaglutide.
"There's a tremendous amount of personalization with these medications with regard to actual goal weight loss," Chief Executive Andrew Dudum said on the company's late Monday call with analysts. "No individual body is the same. No individual person has the same ideal health outcomes."
But Hims stock plummeted 22.3%, closing at 39.86. Shares hit an intraday record high at 72.98 on Feb. 19. Since then, Hims & Hers stock has lost more than 44% of its value.
Hims Stock: 1,000% Earnings Growth
During the fourth quarter, Hims & Hers reported earnings of 11 cents per share, matching the Street's expectation and growing 1,000% year over year. Sales grew more than 95% to $481.1 million, above expectations for $470 million, according to FactSet.
For the year, Hims expects $2.3 billion to $2.4 billion in sales, above the Street's call for $2.1 billion. Of that, $725 million is expected to come from weight-loss drugs.
The outlook includes personalized semaglutide. Hims also expects to bring liraglutide and oral solutions to the platform later this year. Liraglutide is another diabetes drug. Novo sells it as Victoza. Chief Financial Officer Oluyemi Okupe says the oral business is "incredibly strong."
Highly Rated Stock
Hims shares have a perfect IBD Digital Relative Strength Rating of 99 and a matching Composite Rating. This means shares rank in the top 1% of all stocks when it comes to 12-month performance and fundamental/technical measures.
Hims also ranks first on the IBD 50 list of elite growth stocks.
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
