Why Is HIMS & HERS HEALTH I A (HIMS) Stock Down Today?

Why HIMS stock is down today

Hims & Hers Health stock (HIMS) fell 14.20% to $28.09 in a sharply declining session driven by the U.S. Food and Drug Administration's decision to reject the inclusion of emideltide in the 503A Bulks List. The FDA's advisory panel declined to endorse the peptide, marking a setback for the company's product development strategy. This outcome triggered a significant sell-off, with the stock dropping from a morning high of $34.57 to a session low of $27.60.

What Happened

The FDA's Pharmacy Compounding Advisory Committee (PCAC) met to evaluate emideltide, a peptide Hims & Hers has positioned as a key part of its growth strategy. The panel voted against its addition to the 503A list, which allows for bulk compounding of certain medications. This decision raised concerns about the commercial viability of the product and the company’s ability to scale its peptide offerings. The stock opened with a modest 1.7% gap up but quickly reversed course as the news became public and investor sentiment shifted.

The broader market context included recent analyst activity, including a Truist price target increase to $27 and a Citigroup target raised to $35. However, these upgrades did not offset the immediate impact of the FDA outcome. Meanwhile, retail traders on platforms like Reddit and Twitter expressed concern over the stock’s trajectory, with some calling it oversold and questioning its recovery potential.

What The Data Shows

The stock traded 23.8 million shares, matching its 3-month average volume. Over the last eight sessions, HIMS had already declined 8.5% from $35.15 to $32.16. The company has a market cap of $7.3 billion, with a trailing twelve-month revenue increase of 32.8% but remains unprofitable, with a net margin of -0.6%. The stock’s beta of 2.34 indicates high volatility. In the last 36 hours, there were 21 notable options prints, with call premium at $5.0 million versus $881K in put premium.

What To Watch

The stock is currently in a period of heightened scrutiny following the FDA decision. Investors will likely monitor the company’s response and any potential follow-up from the FDA. Additionally, the stock’s performance in the coming weeks will be closely watched for signs of stabilization or further decline.