Key Takeaways
- The telehealth platform transitioned from compounded semaglutide to FDA-approved branded GLP-1 medications in March 2026
- Bank of America downgraded its price target to $21 from $23 while maintaining a Neutral stance
- Analysts project GLP-1 EBITDA contributions may decline by 50% compared to last year
- Competitive pressure intensified as Amazon Pharmacy launched Eli Lilly’s oral GLP-1 medication Foundayo
- Shares of HIMS have declined approximately 39% since the start of 2026, hovering near $20
In March 2026, Hims & Hers executed a strategic shift, abandoning compounded semaglutide in favor of FDA-sanctioned branded GLP-1 treatments. Management described this transformation as positioning the company to become “the largest global consumer health platform for access to more affordable, approved medications.”
Hims & Hers Health, Inc., HIMS
This strategic realignment came after a legal confrontation with Novo Nordisk. The settlement required Hims & Hers to distribute Novo Nordisk’s authorized GLP-1 products instead of less expensive compounded alternatives.
Investors have responded negatively to these developments. HIMS shares have plunged nearly 39% year-to-date in 2026, with the stock trading at approximately $20 on Wednesday.
Bank of America’s Allen Lutz reduced his price objective for HIMS from $23 to $21 recently. His Neutral rating remains unchanged, with concerns centered on compressed peer valuations and short-term profitability challenges.
Lutz forecasted that 2026 EBITDA figures could land roughly 20% beneath current Wall Street expectations. His analysis suggests GLP-1 segment EBITDA contributions might plummet by up to 50% compared to the previous year.
However, Lutz expressed measured optimism regarding the company’s global expansion strategy. He highlighted that the $149 monthly branded GLP-1 subscription could eventually deliver margins comparable to compounded alternatives, contingent on subscriber adoption rates.
Subscriber Transition Rates Will Determine Success
Bank of America projects that between 40% and 50% of current subscribers may transition to branded medication plans, with an additional 5% to 10% remaining on compounded options. This scenario would produce approximately $60 million to $90 million in GLP-1 revenue each quarter.
International expansion represents another growth avenue. The company targets surpassing $1 billion in international revenue within three years, driven by mid-teens organic compound annual growth rates. Bank of America’s analysis of the Eucalyptus platform indicates roughly 90% of revenue will derive from branded GLP-1 distribution, generating approximately 40% gross margins.
Canaccord’s Maria Ripps offered a more optimistic perspective. She maintained her Buy recommendation, contending that the Novo Nordisk collaboration represents a “long-term tailwind” for the business. Ripps believes the market underestimates the company’s telehealth infrastructure, customer base, and broadening treatment offerings.
Amazon Intensifies Competition With Lilly’s Foundayo Launch
The competitive landscape grew more challenging Thursday when Amazon Pharmacy revealed plans to distribute Eli Lilly’s recently approved oral GLP-1 medication, Foundayo, featuring same-day delivery options. HIMS stock dipped 0.5% following the announcement, while Novo Nordisk shares declined 1.5%.
Foundayo represents a once-daily oral therapy designed for adults managing obesity or overweight conditions with related health complications. Insurance coverage starts at $25 monthly, while self-pay customers face $149 monthly charges.
Amazon’s distribution network will provide same-day delivery across nearly 3,000 cities initially, expanding to 4,500 locations before year-end. The e-commerce giant noted it has distributed GLP-1 medications since 2021, with customers saving more than $200 million through automated discount programs, making GLP-1 drugs the top savings category.
Wall Street maintains a Moderate Buy consensus on HIMS, with four Buy ratings and 10 Hold ratings issued over the last three months. The $26.36 average price target suggests potential upside of approximately 36% from current trading levels.
