Hims and Hers Stock (HIMS) Great Growth and Good Value in Q2 2025

In the dynamic intersection of telehealth and consumer wellness, Hims & Hers Health (NYSE:HIMS) continues to stand out. Its Q2 2025 results underscore a company experiencing robust growth while navigating strategic challenges. In this article we will dive into Hims & Hers recent earnings, stock performance & valuation, growth potential, and the risks investor should consider.

About Hims & Hers Health

Hims & Hers Health was founded in 2017 and operates as a direct‑to‑consumer telehealth and online pharmacy in the United States and the United Kingdom. It offers prescription medications, over‑the‑counter products, and personal care services spanning sexual health, hair loss, skincare, mental health, and more. The company went public in 2019 and has more than 1,600 employees and 2.4 million subscribers to its service.

Hims & Hers Financial Performance

In the second quarter of 2025, Hims & Hers reported exceptional financial performance, showcasing strong year-over-year growth across key metrics. Quarterly revenue reached $544.83 million, a significant 72.61% increase from $481.14 million in Q2 2024. Earnings per share (EPS) also surged to $0.17, nearly tripling from $0.06 in the same period last year—a 197.86% growth. On a trailing twelve-month (TTM) basis, revenue climbed to $2.01 billion, up 88.69% from $1.06 billion a year earlier, while EPS soared to $0.79, marking an impressive 866.21% increase compared to $0.08 in Q2 2024. The company also demonstrated consistent cash generation, with TTM free cash flow per share rising to $0.54, up 17.39% year-over-year. Profitability metrics were strong, highlighted by a gross profit margin of 76.2%, a net profit margin of 9.62%, and a free cash flow margin of 6.57%. Hims & Hers also displayed solid returns on capital, with a return on assets of 6.94% and a notably high return on equity of 41.88%, supported by a debt-to-equity ratio of 1.86.

Over the past five years, Hims & Hers has transitioned from an unprofitable company to a profitable one. Revenue has been growing at a 78.5% CAGR, and both net income and free cash flow turned positive in 2024 and continue to grow.

Hims and Hers Fiscal 2025 Financial Forecast

Looking forward, analysts forecast revenue to reach $2.34 billion in 2025, representing a 58.68% increase from $1.48 billion in 2024, while EPS is expected to grow to $0.61, up 15.68% from $0.53. The consensus analyst price target stands at $50.45, reflecting a neutral “Hold” rating, though the highest target reaches $85, implying a potential 66.26% upside from current levels.

HIMS Stock Price Performance and Valuation

At the time this article was written, the stock was trading at $51.13 per share. Hims & Hers has delivered an extraordinary stock price performance over the past year, with its share price increased by 202.9%, significantly outperforming the S&P 500’s 21.2% gain in the same period. Over the past five years, the stock has risen 397.8%, again beating the S&P 500’s 89.1% increase, highlighting strong long-term momentum and investor confidence. 

From a valuation perspective, the company is trading at a price-to-sales (P/S) ratio of 6.08 on a trailing twelve-month basis, with a forward P/S of 5.36. The price-to-earnings (P/E) ratio stands at 70.66 on a trailing basis, with a forward P/E of 92.36. Additionally, the price-to-free-cash-flow (P/FCF) ratio is 87.3.

Based on Fiscal.ai data, if we look at the valuation since 2024, the forward P/S, forward P/E, and P/FCF are all above the average. While the valuation appears high, Hims & Hers is still in a rapid growth phase, making it justifiable for a typical growth stock that is growing revenue by more than 70% year over year.

Hims & Hers Growth Potential

Hims & Hers growth prospect remains robust, driven by several factors.

• Strong Subscription Model with Improving Unit Economics
  Hims & Hers’ subscription-based revenue model shows strong fundamentals and improving unit economics that support sustainable growth. In Q2 2025, the company reported 2.4 million subscribers, with 82% retaining subscriptions beyond three months, reflecting solid customer loyalty. The average monthly revenue per subscriber was $74, down from $84 last quarter due to shifts in GLP-1 subscribers, yet revenue per customer continues to grow steadily. About 1.5 million customers up 89% year-over-year, use personalized treatment plans with over 500,000 managing multiple conditions.
  This effective cross-selling boosts customer lifetime value and deepens platform engagement. Gross margins reached 76%, a three-point increase quarter-over-quarter, driven by growth outside weight management. Adjusted EBITDA was $82.2 million with a margin above 15%, demonstrating scalable profitability. Predictable subscription revenue enables ongoing investments in technology, international markets, and new service expansions, ensuring strong financial stability.
• Expanding Market Opportunity in the Growing Telehealth Sector
  The telehealth market offers significant growth potential, with the global market expected to rise from $186.4 billion in 2025 to $791 billion by 2032, at a CAGR of 22.9%. In the U.S., direct-to-consumer telehealth services are growing even faster, projected at a 30.3% CAGR from 2024 to 2030 as digital healthcare adoption accelerates. Hims & Hers focuses on underserved and stigmatized conditions within this market, benefiting from a subscription-based model that generates over 90% of its revenue, ensuring steady recurring income.
  McKinsey estimates that $250 billion of current U.S. healthcare spending could shift to virtual care, highlighting vast expansion opportunities. The rise in consumer acceptance of telehealth post-pandemic, along with the company’s emphasis on personalized care, aligns well with trends toward precision medicine and patient-centric healthcare, positioning Hims & Hers for strong growth in this expanding market.
• Strategic International Expansion and Market Diversification
  Hims & Hers is advancing a strategic international expansion that substantially increases its market reach. The company recently acquired ZAVA, a European digital health platform with over 1.3 million active customers across the UK, Germany, France, and Ireland, which completed nearly 2.3 million consultations in 2024. This acquisition boosts Hims & Hers’ customer base by about 50%, establishing a strong presence in key European markets.
  Additionally, the company plans to enter the Canadian market in 2026, timed with the availability of generic semaglutide as Novo Nordisk’s patent expires. This will enable Hims & Hers to offer more affordable weight loss treatments in a market where branded GLP-1 drugs currently exceed C$200 per month. These international efforts are expected to add at least $50 million in incremental revenue in 2025 from ZAVA, with further growth anticipated in Canada, showcasing the company’s scalable model for sustained global expansion.

Risks to Consider

While HIMS stock looks attractive, we should be mindful of potential risks.

• Loss of Key Partnership (Novo Nordisk)
  Hims & Hers recently lost an important partnership with Novo Nordisk involving the weight-loss drug Wegovy. This setback caused the company’s stock to drop sharply by about 30%. The loss raises serious concerns about Hims & Hers' future growth prospects, as it impacts their revenue potential and weakens their market position. This development highlights significant challenges the company faces in sustaining competitiveness and driving growth moving forward.
• Dependence on Marketing Spending for Growth
  Hims & Hers depends significantly on marketing to attract and keep customers. Recently, a cutback in marketing expenses has caused slower growth rates, emphasizing the risk that inadequate marketing investment could negatively impact customer acquisition and revenue expansion. Maintaining strong marketing efforts is crucial for the company to sustain growth and competitive advantage, as reduced spending may limit its ability to attract new customers and generate consistent revenue in the future.
• Legal and Regulatory Risks from Compounded Drug Sales
  Hims & Hers has faced criticism and legal scrutiny for selling compounded versions of FDA-approved drugs, including weight-loss medications. Novo Nordisk accused the company of deceptive marketing and violating laws that prohibit mass sales of compounded drugs. This situation exposes Hims & Hers to potential legal challenges and reputational damage, raising concerns about regulatory compliance and the company’s long-term stability in a highly regulated market.

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Conclusion

Hims & Hers Health continues to impress with its rapid revenue and earnings growth, strong margins, and expanding customer base. Despite premium valuations, its performance has consistently outpaced the broader market, supported by a scalable model and growing demand in telehealth and wellness. While risks remain, the company’s long-term growth outlook remains compelling. For investors seeking exposure to a high-growth digital health player with proven execution and strong fundamentals, HIMS presents a promising opportunity worth considering in a diversified portfolio.