# Hims & Hers grew revenue 49% in the third quarter and lost $33 million, with gross margin down from 74% to 57% HIMS, NYSE. Published November 12, 2026. Price as of the November 12, 2026 regular session close. Values are in US dollars. Latest reported quarter: July to September 2026. ## Verdict: REDUCE at $19.73 Hims & Hers is growing fast, but it keeps far less of each dollar of sales than a year ago, and $1.42 billion of debt-like claims sit in front of shareholders. At $19.73 the shares trade 87% above my Base value of $10.56, and the price already asks for close to management's own 2030 margin target. New money waits for $6.07 or less. - Bear value: $0.00 - Base value: $10.56 - Bull value: $25.87 - Upside to base value: -46.5% - Maximum buy price: $6.07 - Required margin of safety: 42.5% - Enterprise value / 2026 guided adjusted EBITDA: 22.7x - 2026 owner free cash flow (my estimate): -$164 million - 2026 adjusted EBITDA guidance: $257 to $277 million - Net debt-like claims, September 30, 2026: $1,424 million - Business quality: 43.75/100 - Valuation score: 5/100 - Confidence: 15/25, grade C Hims & Hers grew revenue 49% in the third quarter to $890.4 million and lost $33.0 million doing it. Gross margin fell from 74% to 57%, and the company ended September with about 103,000 fewer subscribers than it had in June. It also cut its full-year adjusted EBITDA guidance for the third time this year, to $257 million to $277 million. The shares fell roughly 12% on November 10 and closed at $19.73 on November 12, and the company is still valued at 22.7 times that guided EBITDA. My Base value is $10.56 a share, the Bear value $0.00 and the Bull value $25.87. The price sits between the Base and the Bull. I count stock compensation as a cost and the acquisition payments still owed as debt, and on that basis the business produced negative owner free cash flow in 2026. I could not find a company-specific reason for today's decline of about 5%; analyst price target cuts followed the results earlier this week. Valuation route: consumer telehealth and subscription platform with negative owner cash flow today, valued with an eight year model of free cash flow after stock compensation for 2027 to 2034, cross-checked with a multiple of 2028 EBITDA after stock compensation. Net debt includes the convertible notes, the unpaid acquisition payments and the earn-outs. Cash flows are discounted at 11%. ## What Hims & Hers is Hims & Hers sells treatments and wellness products online through a subscription telehealth platform. It had about 2.79 million subscribers at the end of September, each paying about $105 a month on average, up from $81 a year earlier. United States revenue was $657.1 million in the quarter, up 21%. International revenue was $233.3 million, up 321%, because the Eucalyptus acquisition closed in June 2026; it is now 26% of sales. The product mix has changed since 2025. Rules on compounded GLP-1 drugs tightened, the company's arrangement with Novo Nordisk changed more than once, and it now sells branded weight-loss drugs, with Eli Lilly's Zepbound and Foundayo being added next to Novo's, according to TIKR. In the third quarter it also launched testosterone replacement therapy, its first controlled substances, and announced a product called Peptides Plus for late November. Andrew Huberman was appointed to the board in the November 9 filing. Management still targets $6.5 billion of revenue and $1.3 billion of adjusted EBITDA in 2030, a 20% margin. I treat that as the Bull case, not the Base. ## The latest results | $ million | Q3 2026 | Q3 2025 | Change | 9M 2026 | | --- | --- | --- | --- | --- | | Revenue | 890.4 | 599.0 | +49% | 2,251.7 | | United States revenue | 657.1 | 543.5 | +21% | n/a | | International revenue | 233.3 | 55.5 | +321% | n/a | | Gross margin | 57% | 74% | -17 points | 61.6% | | Net income (loss) | -33.0 | 15.8 | n/a | n/a | | Adjusted EBITDA | 82.4 | 78.4 | +5% | 187.0 | | Cash from operations | 65.4 | 148.7 | -56% | 118.8 | | Free cash flow (company definition) | 26.0 | 79.4 | -67% | 10.8 | Revenue accelerated for the second quarter in a row and was in line with what analysts expected. Everything below revenue was weaker. Gross profit was $509.2 million, a 57% margin, and marketing cost $247.3 million, or 28% of revenue. The operating loss was $66.1 million, including $64.5 million of stock compensation and $35.4 million of acquisition, transaction and earn-out costs. Adjusted EBITDA of $82.4 million excludes both. It is 9.3% of revenue, down from 13% a year earlier. Subscribers fell from about 2.89 million in June to 2.79 million, which management attributes to restrained marketing ahead of the Zepbound launch and to merging international brands. Revenue still rose because each subscriber now pays more. The CFO also said $18 million of weight-loss membership revenue moved into the fourth quarter. | Guidance, $ million | August | November | | --- | --- | --- | | 2026 revenue | 3,100 to 3,300 | 3,130 to 3,150 | | 2026 adjusted EBITDA | 275 to 325 | 257 to 277 | | Fourth quarter revenue | n/a | 875 to 895 | | Fourth quarter adjusted EBITDA | n/a | 70 to 90 | Full-year adjusted EBITDA guidance has now come down three times in 2026, and management says investment will cause some quarter-to-quarter variability. Revenue guidance for the fourth quarter ($875 million to $895 million) ranges from 2% below to 1% above the third quarter, before the $18 million that moves in from the third. Management also raised its 2026 international revenue guide to at least $650 million and expects an international run rate above $1 billion in 2027. ## Free cash flow and what it leaves out The company defines free cash flow as cash from operations less capital spending and capitalized software. For nine months that is $118.8 million less $89.1 million less $18.9 million, or $10.8 million. Three things sit outside it. Stock compensation, $143.5 million in nine months, is a real cost paid in shares. The company sold $434.5 million of receivables to JPMorgan under an uncommitted $400 million program, which pulls cash forward, and the amount by which this flatters the cash flow is not disclosed. Manufacturer rebate receivables on the balance sheet were still $345.3 million. And $130.3 million of deferred acquisition payments went out as cash outside operations. | 2026 estimate, $ million | Amount | | --- | --- | | Adjusted EBITDA, midpoint of the guided 257 to 277 | 267 | | Capital spending and capitalized software (9M actual 108.0, fourth quarter my estimate 40) | -148 | | Acquisition costs, working capital, interest and tax (balancing item) | -78 | | Company free cash flow (9M actual 10.8, fourth quarter my estimate 30) | 41 | | Stock-based compensation (9M actual 143.5, fourth quarter my estimate 61.5) | -205 | | Owner free cash flow | -164 | | Owner free cash flow per share | -$0.70 | The bridge is my arithmetic. Nine months are actual, the fourth quarter is my estimate. After stock compensation, the business consumed about $164 million in 2026, or 70 cents a share. A screener that quotes a trailing free cash flow of $134 million (StockAnalysis, from an earlier quarter) is showing the company's definition, before stock compensation and before the 2026 acquisition cash. ## Debt, shares and capital allocation | September 30, 2026, $ million | Amount | | --- | --- | | Cash and cash equivalents | 605.6 | | Short-term investments | 106.6 | | Liquidity | 712.2 | | 2030 convertible notes, 0%, principal (conversion price $70.67) | 1,000.0 | | 2032 convertible notes, 0%, principal (conversion price $29.53) | 402.5 | | Deferred acquisition payments (current 478.6, long term 84.5) | 563.1 | | Earn-out liabilities (current 86.6, long term 84.1) | 170.8 | | Debt-like claims | 2,136.4 | | Net debt-like claims used in the valuation | 1,424.1 | | Per share | $6.08 | | Shares outstanding, millions (Class A 226.0 plus Class V 8.4) | 234.4 | The convertible notes carry no interest and mature in May 2030 and June 2032, so there is no refinancing event for three and a half years. The nearer issue is the acquisition payments. Deferred payments of $478.6 million fall due within 12 months and the Eucalyptus installments run through the 18 month anniversary of the June closing. The company has $712.2 million of liquidity, plus a $175 million revolving credit line with $161.0 million available and no loans outstanding. It can settle most of the deferred and earn-out payments in shares, up to 19.9% of its Class A stock, so cash is not the binding limit but dilution could be. At today's price the full $563 million in shares would be about 28.5 million shares, 12% of the total. I count the 2030 notes at face value because their conversion price of $70.67 is far above any value in my cases. I count the 2032 notes at face value too: their $29.53 conversion price is above even the Bull value of $25.87. A capped call (cash paid in 2026: $36.7 million) reduces dilution up to a cap whose level I did not find. No shares were repurchased in 2026 through September. There is no dividend. I did not find finance lease liabilities in the filing excerpts; operating leases are $193.4 million and their cost already sits in EBITDA, so I left them out. ## Primary valuation: owner free cash flow after stock compensation I project revenue, adjusted EBITDA margin, stock compensation and capital spending for eight years. In the Base, revenue grows 20% in 2027 as Eucalyptus and the new categories annualize, then 15%, 12%, 10%, 8%, 7%, 6% and 5%. That reaches 5.34 billion in 2030, which is 82% of management's $6.5 billion target. The adjusted EBITDA margin rises from 8.5% in 2026 to 9.5% in 2027, 15% in 2030 and 17% from 2033, below management's 20%. Stock compensation falls from 6.5% of revenue to 3.5%, capital spending is 4% falling to 3.5% of revenue, cash taxes are 22% of positive owner profit with no credit for loss carryforwards, and working capital absorbs 2% of each added dollar of revenue. Cash flows are discounted at 11% from November 12, 2026, with long-run growth of 3% after 2034. The 11% discount rate is a judgment. The shares have a five-year beta of about 2.4 (StockAnalysis), the profit history is short and the business depends on two drug makers and on changing regulation, so I did not use a utility-like rate. | Base case, $ million | 2026E | 2027E | 2028E | 2030E | 2032E | 2034E | | --- | --- | --- | --- | --- | --- | --- | | Revenue | 3,140 | 3,768 | 4,333 | 5,339 | 6,169 | 6,866 | | Revenue growth | 9M: +30% | +20% | +15% | +10% | +7% | +5% | | Adjusted EBITDA margin | 8.5% | 9.5% | 11.5% | 15.0% | 16.5% | 17.0% | | Stock compensation, % of revenue | 6.5% | 6.0% | 5.5% | 4.5% | 4.0% | 3.5% | | Owner EBITDA (adjusted EBITDA less stock compensation) | 62 | 132 | 260 | 561 | 771 | 927 | | Owner free cash flow | -164 | -31 | 63 | 282 | 425 | 529 | | Case | Revenue 2030 | Adjusted EBITDA margin 2030 | Owner free cash flow 2030 | Enterprise value | Value per share | | --- | --- | --- | --- | --- | --- | | Bear | 3,778 | 11.0% | 101 | 863 | $0.00 (floor, -2.39 before) | | Base | 5,339 | 15.0% | 282 | 4,208 | $11.88 | | Bull | 6,436 | 19.0% | 561 | 8,126 | $28.59 | The terminal value is 69% of the Base enterprise value (Bear 62%, Bull 69%). That is below the 75% level that calls for a closer look in a model of this length, and it is high for a reason: owner free cash flow is negative in 2027 and reaches $529 million only in 2034. In the Bear case the $1.42 billion of claims exceeds the value of the operations, so the equity is worth nothing in my arithmetic; the $0.00 is a floor, since a share cannot be worth less than zero, not a forecast of bankruptcy. ### Sensitivity | Revenue growth each year \ margin each year | 2 points lower | As Base | 2 points higher | | --- | --- | --- | --- | | 2 points lower | $5.77 | $9.73 | $13.64 | | As Base | $7.44 | $11.88 | $16.27 | | 2 points higher | $9.30 | $14.28 | $19.21 | | Discount rate \ terminal growth | 2% | 3% | 4% | | --- | --- | --- | --- | | 10% | $12.97 | $15.01 | $17.74 | | 11% | $10.39 | $11.88 | $13.79 | | 12% | $8.34 | $9.46 | $10.86 | | One change at a time, primary Base $11.88 | Value per share | | --- | --- | | Discount rate 12% / 10% (instead of 11%) | $9.46 / $15.01 | | Terminal growth 2% / 4% (instead of 3%) | $10.39 / $13.79 | | Adjusted EBITDA margin 2 points lower / higher every year | $7.44 / $16.27 | | Revenue growth 2 points lower / higher every year | $9.73 / $14.28 | | Earn-out liabilities ignored | $12.60 | | Deferred acquisition payments and earn-outs both ignored | $15.01 | Margin is the biggest swing factor: one point of adjusted EBITDA margin in every year is worth $2.20 a share. The acquisition payments matter, but they are not what separates the price from the value: even with the deferred payments and earn-outs ignored entirely, the Base DCF is $15.01, below the price. ## Secondary valuation: multiple of owner EBITDA The second method values 2028 owner EBITDA, which is adjusted EBITDA less stock compensation, at the end of 2027 and discounts it back, adding the 2027 free cash flow. I use owner EBITDA because adjusted EBITDA adds stock compensation back, and at 5% to 7% of revenue that is a large item. The multiples are 10 times in the Bear, 15 times in the Base and 19 times in the Bull. In the Base, owner EBITDA grows from $260 million in 2028 to $927 million in 2034, a rate of 24% a year, so the 15 times pays for continued growth but not for a perfect margin. Capital spending takes more than half of 2028 owner EBITDA, which is why I do not apply a higher multiple. | Case | Owner EBITDA 2028E | Multiple | Enterprise value end-2027 | Value per share | Primary value | Gap | | --- | --- | --- | --- | --- | --- | --- | | Bear | 160 | 10x | 1,602 | $0.00 | $0.00 | n/a | | Base | 260 | 15x | 3,900 | $8.59 | $11.88 | 32.2% | | Bull | 386 | 19x | 7,334 | $21.79 | $28.59 | 27.0% | | Multiple \ 2028E owner EBITDA | 10% lower | As Base | 10% higher | | --- | --- | --- | --- | | 12x | $4.45 | $5.63 | $6.81 | | 15x | $7.11 | $8.59 | $10.06 | | 18x | $9.77 | $11.54 | $13.32 | | Measure at $19.73 | Value | | --- | --- | | Enterprise value / 2026 revenue | 1 | | Enterprise value / 2026 guided adjusted EBITDA | 2 | | Enterprise value / my 2027E adjusted EBITDA | 1 | | Enterprise value / my 2028E adjusted EBITDA | 1 | | Enterprise value / my 2028E owner EBITDA | 2 | | Forward price to sales, Teladoc / LifeMD (Zacks, date not stated) | 0 | At the Base multiple the 2028 enterprise value is $3,900 million, or 7.8 times my 2028 adjusted EBITDA. The market pays 12.1 times that same number today. Each turn of the multiple is worth $0.99 a share. The Teladoc and LifeMD multiples come from one article with no date and bracket how low sales multiples go for slower, lower-margin telehealth; they do not set mine. This method shares my 2027 and 2028 assumptions with the DCF, so agreement between them is partly built in. ## Cross-check against the stock's own range The shares touched a quarter low of $22.88 on November 5, recovered about 14% into the report, and then fell below that low after it. At $19.73 they are 43% below the $34.46 reached on August 21 and about 26% below the 200-day average of about $26.80. The 52-week low is $13.74, so the stock is still 44% above it. Each guidance change has moved the price by double digits this year, which makes a value built from cash flow a better anchor than recent trading levels. ## Valuation triangulation | Method | Bear | Base | Bull | Weight | | --- | --- | --- | --- | --- | | Owner free cash flow DCF | $0.00 | $11.88 | $28.59 | 60% | | Multiple of 2028E owner EBITDA | $0.00 | $8.59 | $21.79 | 40% | | Gap between methods | n/a | 32.2% | 27.0% | | | Adopted | $0.00 | $10.56 | $25.87 | | The two methods differ by 32.2% at the Base in equity value, which is above the 30% flag. Most of that comes from leverage: the enterprise values differ by only 20.2%, but $1.42 billion of claims sit in front of the shareholders and magnify the gap. The rest comes from the terminal year, where the DCF carries a 17% margin forever and the multiple stops at 15 times 2028. The Bull gap is 27.0%. The Bear equity is zero in both methods. I weigh the DCF at 60% because it sees the full margin path, and the multiple at 40% because it anchors the near-term level of earnings. Both methods say the price is far too high, so the divergence does not change the decision. | Base case | Enterprise value, $ million | Value per share | EV / 2027E adjusted EBITDA | EV / 2028E adjusted EBITDA | | --- | --- | --- | --- | --- | | DCF | 4,208 | $11.88 | 11.8x | 8.4x | | Multiple of owner EBITDA | 3,437 | $8.59 | 9.6x | 6.9x | | Market at $19.73 | 6,049 | $19.73 | 16.9x | 12.1x | On a common basis the DCF values the business at 8.4 times 2028 adjusted EBITDA and the multiple method at 6.9 times, against 12.1 times in the market. The probability-weighted value, with 30% Bear, 45% Base and 25% Bull, is $11.22, which is 43% below the price. I treat it as a cross-check, not a target. ## What is the market already pricing in? | Measure at $19.73 | Value | | --- | --- | | Market value of the shares | $4.62 billion | | Enterprise value after $1.42 billion of net debt-like claims | $6.05 billion | | Revenue growth the price needs, on top of my Base | +5.8 points a year, a 16.1% rate to 2034 (Base 10.3%) | | Or adjusted EBITDA margin the price needs, with Base growth | 18.6% in 2030 and 20.6% in 2034 (Base 15% and 17%) | | Or a discount rate of | 8.9% (Base 11%) | | Return the Base gives at this price | 4.0% a year | Each of these is a single change with everything else at Base. The price works if adjusted EBITDA margin reaches 18.6% by 2030, which is close to management's 20% target, or if revenue grows 16% a year to 2034 instead of 10%, or if the right discount rate is 8.9% instead of 11%. The Bull case is worth $28.59 on the DCF. In plain terms, the market is paying for the plan in full after a quarter in which the plan's central number, gross margin, moved the wrong way by 17 points. ## Bear, base and bull scenarios | Case | Revenue CAGR 2026 to 2034 | Owner free cash flow 2030 | Primary | Secondary | Adopted | Versus price | | --- | --- | --- | --- | --- | --- | --- | | Bear | +3.5% | 101 | $0.00 | $0.00 | $0.00 | -100.0% | | Base | +10.3% | 282 | $11.88 | $8.59 | $10.56 | -46.5% | | Bull | +13.5% | 561 | $28.59 | $21.79 | $25.87 | +31.1% | - **Bear:** revenue grows 8% in 2027 and then 5%, 3% and 3%, reaching $3,778 million in 2030. Branded weight-loss drugs keep gross margin near this quarter's level. The adjusted EBITDA margin climbs only to 11%, stock compensation stays near 4% of revenue and the claims of $1.42 billion absorb the whole enterprise value. Long-run growth is 2%, with a multiple of 10 times. - **Base:** revenue growth of 20%, 15%, 12% and 10% to $5,339 million in 2030, margin of 15% in 2030 and 17% from 2033. Long-run growth is 3%, with a multiple of 15 times. - **Bull:** management's plan roughly delivered: revenue growth of 27%, 21%, 17% and 14% to $6,436 million in 2030 and a 19% adjusted EBITDA margin that same year, 21% from 2033. Long-run growth is 3.5%, with a multiple of 19 times. The Bear sits at the floor of zero and the Bull 31% above the price, so the range is wide, but the price sits in its upper third. The price asks for most of the Bull to earn the 11% I discount at. | Bought at $19.73, held 5 years | Return a year | | --- | --- | | Base: exit at 1.08x revenue, the value my DCF gives the business at the end of 2031 | 4.0% | | Base, if today's 1.93x enterprise value to revenue did not change | 17.9% | | Bear: exit at 0.31x revenue (equity almost fully absorbed by claims) | -65% | | Bull: exit at 1.67x revenue | 21.3% | These returns are my arithmetic, not forecasts. They assume owner free cash flow is kept in the company, the share count stays flat and the business is valued at the end of year five at what my own DCF gives it for that date. The 17.9% in the second row is what you get if investors keep paying today's 1.93 times revenue for a business that is 1.8 times larger. That is the real argument for the stock, and it requires the margin gap to close while the multiple does not compress. ## How the buy price is set The required margin of safety follows the confidence grade, and grade C starts at 42.5%. I add nothing on top: the regulatory and supplier risks are in the scenarios, and the method gap is already in the confidence grade. $10.56 times 0.575 is **$6.07**. The two methods give $6.83 and $4.94 separately. That price is 69% below today's. The stock traded as low as $13.74 in the past year, so $6.07 would be a new low. If you prefer a return target, the price at which the Base earns 12% a year is $13.65 and 10% a year is $14.93; both sit below the price. | Entry price | Base return a year over 5 years | | --- | --- | | $6.07 | 31.7% | | $11.88 | 15.2% | | $13.65 | 12.0% | | $14.93 | 10.0% | | $19.73 | 4.0% | For an existing holder the price is above the Base and between the Base and Bull cases, so I would not add. I would reconsider if the first 2027 guidance implied an adjusted EBITDA margin near 11%. ## Dividend and buyback Hims & Hers pays no dividend and repurchased no shares in the first nine months of 2026, against $9.5 million in the same period of 2025. Stock compensation of $143.5 million in nine months is the main source of share issuance, and deferred acquisition payments could add more. ## Reasons to own Hims & Hers - Revenue growth of 49% in the quarter, the fastest in more than a year, with United States revenue still growing 21% on a large base. - Revenue per subscriber of $105, up 30%, which shows the customer base is being moved to higher-value products. - International revenue of $233.3 million a quarter, with management expecting a run rate above $1 billion in 2027. - $712.2 million of liquidity, an undrawn credit line and zero-coupon convertible notes that do not mature until 2030 and 2032. - New categories, testosterone therapy and Peptides Plus, plus access to both Novo Nordisk and Eli Lilly drugs. ## What could go wrong? - **Margin:** gross margin fell 17 points in a year. If branded weight-loss drugs keep margin near 57%, the 20% EBITDA target in 2030 does not happen. One point of margin is worth $2.20 a share. - **Subscribers and marketing:** subscribers fell in the quarter, and the CFO said earlier that investment will cause variability. The company's own CEO said he would accept subscriber losses to protect economics, according to TIKR. - **Regulation and supply:** the business depends on drug supply from two manufacturers, on rules for compounded drugs that already changed once, and now on controlled-substance rules for testosterone. A compounded GLP-1 stream made up about 18% of fourth quarter 2025 sales, per one secondary source, and it has since been eroded. - **Acquisition payments:** $563.1 million of deferred payments and $170.8 million of earn-outs are owed, and the earn-out targets depend on 2026 to 2028 revenue and EBITDA. Paying in shares avoids cash but dilutes. - **Cash flow quality:** reported free cash flow of $10.8 million over nine months includes proceeds from receivable sales whose effect is not disclosed, and it is before $143.5 million of stock compensation. - **Guidance record:** three cuts to the profit outlook in 2026, and a fourth quarter revenue guide that implies almost no growth from the third quarter. - **Valuation of my own numbers:** the Base is a top-down path with my estimates for stock compensation, capital spending and tax. It is not a product-by-product forecast. ## Management execution Management has grown revenue 49% by adding categories and countries quickly, and it is adding Lilly's drugs next to Novo's. The same record includes three cuts to 2026 profit guidance, a surprise third quarter loss, a 17 point drop in gross margin and a subscriber decline that came after management chose to restrain marketing. The 2030 targets ($6.5 billion and $1.3 billion) have been kept through all of it. I score management 5 out of 10: the speed of execution is real, but forecasts have missed repeatedly and the capital is going into acquisitions whose payments are still owed. The company has two classes of shares (Class A and Class V); I did not verify the voting split. ## Stock Analyza scorecard | Business quality | Score | | --- | --- | | Moat and pricing power | 10/20 | | Return on capital over its cost | 5/20 | | Balance sheet and resilience | 7.5/15 | | Cash and earnings quality | 3.75/15 | | Growth and reinvestment runway | 11.25/15 | | Management and capital allocation | 5/10 | | Dilution and governance | 1.25/5 | | Total | 43.75/100 | Business quality is below average. Growth and the ability to add products score well. Return on capital and cash quality do not: the company reports a GAAP loss, owner free cash flow is negative, and the acquisitions are paid for with deferred payments that are only now showing up in cash. The moat is a customer relationship and a platform, not a patent or a cost advantage, and its drugs come from two suppliers who also sell directly. | Valuation | Score | | --- | --- | | Discount to Base value (-86.8%) | 0/50 | | Price against the Bear value (-100%) | 0/30 | | What the price implies (needs a favorable case, close to management's own target) | 5/20 | | Total | 5/100 | The valuation score is the minimum for two reasons. The price is 87% above the Base value, and the Bear value is zero. The price implies a margin close to management's own target, which is why that component is not also zero. ## Confidence score | Area | Score | | --- | --- | | Historical data and sources (company filings, price from a quote page) | 3.75/5 | | Accounting and ownership (finance leases not found, receivable sales not sized) | 2.5/5 | | Evidence for the forecast (guidance cut three times, margin path is my judgment) | 2.5/5 | | Model construction (two methods, one shared 2027 driver) | 3.75/5 | | Independent challenge (methods differ by more than 30% in equity value) | 2.5/5 | | Total, grade C | 15/25 | The score rests on the company's own release and quarterly filing, which give a clear bridge from reported numbers to debt-like claims. The gaps are finance leases, the size of the receivable sales effect and the margin path, which is my judgment against a guidance record that moved in the wrong direction three times. Grade C, with the method gap flagged. ## What I would watch from here ### Green - Fourth quarter adjusted EBITDA above $90 million - Gross margin back above 60% - Subscribers above 2.89 million in the first quarter of 2027 - 2027 guidance that implies an adjusted EBITDA margin of 11% or more ### Yellow - Fourth quarter adjusted EBITDA inside the guided $70 million to $90 million - Subscribers flat and revenue per subscriber still rising - Deferred acquisition payments settled in shares instead of cash ### Red - Gross margin below 55% - A fourth consecutive cut to full-year profit guidance - Subscribers fall again in the fourth quarter - Liquidity below the deferred payments due within a year The fourth quarter report in February, with the first 2027 guidance, is the next test of whether margin has stopped falling. ## The three most important thesis breakers These are the events that would make the Reduce call wrong. 1. Gross margin recovers above 65% while revenue growth stays above 25%, which moves the adjusted EBITDA margin toward 19% by 2030 and takes the Base close to the price. 2. Subscribers grow again after the Zepbound launch and the first 2027 guide shows margin expanding, which would shift weight from my Base toward the Bull of $25.87. 3. The price falls to $6.07 or less, where the required margin of safety is met even with the Base unchanged. ## Stress test and independent check The model was built from the third quarter 2026 report (8-K), the quarterly filing (10-Q) for September 30, 2026, the 2025 annual report and the notes offering releases. The primary value, the secondary value, the triangulation, the buy price, the reverse tests, the sensitivity grids and the returns were recalculated in a separate script, and the numbers in the tables come from that script. | Input | Status | | --- | --- | | Revenue, profit, cash flow, shares, liquidity, convertible notes, deferred payments, earn-outs | Third quarter 2026 report (8-K) and quarterly filing (10-Q), as reported | | Guidance and management 2030 targets | Company release; 2030 targets from a secondary source | | 2026 fourth quarter cash flow, stock compensation, capital spending | My estimates | | Revenue, margin and stock compensation paths from 2027 | My estimates | | Finance lease liabilities | Not found in the release or the filing excerpts I read | | Price | Yahoo Finance close for November 12; XTB quote $19.72 | The weakest points are the fourth quarter cash flow, stock compensation and capital spending paths, which are my estimates, and the margin path, which is my judgment. The generous choices are the zero cash credit for the revenue deferral, a margin that rises in every year and a 15 times multiple on a business with a GAAP loss. The conservative choices are an 11% discount rate, full tax on future profit and counting the acquisition payments as debt. I did not use analyst price targets or consensus estimates in the model. ## Final verdict: reduce at $19.73 Hims & Hers is a real business that is growing quickly and has enough cash to get through the next year. The problem is the price. At $19.73 the enterprise value is $6.05 billion, which is 12.1 times my 2028 adjusted EBITDA, for a company that lost money on 49% growth and has $1.42 billion of claims ahead of the shareholders. The Base earns 4.0% a year over five years, below the 11% I discount at, and a 10% return needs a purchase at $14.93. The market has marked the stock down 43% from August and still prices in the 2030 plan. That is the whole gap between a falling stock and a cheap one. **Verdict: REDUCE at $19.73, do not add. Base $10.56, -46.5% against the price, Bear $0.00, Bull $25.87, Confidence C (15/25). Required margin of safety 42.5%, maximum buy price $6.07, range $4.94 to $6.83 under the two methods.** ## More analyses on Patreon This analysis is free. Premium members get every in-depth analysis, the full archive and a vote on which stocks get analyzed next: https://www.patreon.com/stockanalyza ## Sources Primary sources are the Hims & Hers [third quarter 2026 results release](https://www.sec.gov/Archives/edgar/data/0001773751/000177375126000242/hims-20260930x8xkearningsr.htm) (8-K, November 9, 2026), the [investor relations page](https://investors.hims.com/news/news-details/2026/Hims--Hers-Health-Inc--Reports-Third-Quarter-2026-Financial-Results/default.aspx), the [quarterly report for September 30, 2026](https://www.sec.gov/Archives/edgar/data/0001773751/000177375126000246/hims-20260930.htm) (10-Q), the [2025 annual report](https://www.sec.gov/Archives/edgar/data/1773751/000177375126000022/hims-20251231.htm) (2030 notes) and the [pricing release for the 2032 notes](https://www.businesswire.com/news/home/20260518180060/en/Hims-Hers-Health-Inc.-Prices-Upsized-%24350-Million-Convertible-Senior-Notes-Offering-to-Support-International-Expansion-and-Accelerate-AI-Driven-Platform-Investment). Context and third-party data: [TIKR](https://www.tikr.com/blog/hims-hers-sinks-9-on-ebitda-guidance-cut-as-ceo-says-hed-take-subscriber-losses-every-time) (third guidance cut, subscriber decline, Zepbound), [Fierce Healthcare](https://www.fiercehealthcare.com/finance/hims-hers-reports-8904m-q3-revenue-tightens-2026-outlook) (revenue deferral), [FourWeekMBA](https://fourweekmba.com/ai-hims-hers-non-us-revenue-grows-4x-to-233m-total-890m/) (international share, revenue per subscriber), [Earnings Whispers via Finviz](https://finviz.com/news/419702/hims-hers-accelerates-revenue-49-but-an-eps-miss-third-ebitda-cut-and-first-subscriber-decline-undercut-the-growth-story) (new products, board, quarter low), [Panabee](https://www.panabee.com/news/hims-hers-health-earnings-q3-2026) (2030 targets), [Rallies](https://rallies.ai/news/hims-hers-cuts-fy2025-guidance-as-shares-fall-50-and-unveils-250m-buyback) (compounded GLP-1 share of sales), [Zacks](https://www.zacks.com/stock/news/2883310/hims-hers-plunges-294-in-three-months-how-to-play-the-stock) (peer sales multiples) and [Defense World](https://www.defenseworld.net/2026/11/12/hims-hers-health-nysehims-stock-price-target-cut-by-morgan-stanley.html) (200-day average). Prices: the [Yahoo Finance quote page](https://finance.yahoo.com/quote/HIMS/) for the November 12 close of $19.73 and the 52-week low, the XTB quote of $19.72, and [StockAnalysis](https://stockanalysis.com/stocks/hims/statistics/) for beta and trailing free cash flow. **Disclaimer.** This analysis is provided solely for research and educational purposes. It is not personalized investment, financial, legal or tax advice. Values are estimates, not forecasts or trading instructions. Stocks that depend on regulation, drug supply and fast-changing consumer demand can move sharply, and you can lose money. Do your own research and consider your own circumstances. Method: Master Investment Analysis Framework v4.3. Approach: eight year model of free cash flow after stock compensation, discounted at 11%, cross-checked with a multiple of 2028 EBITDA after stock compensation, with acquisition payments and earn-outs counted as debt. Confidence: C, 15/25. Data checks: passed with warnings. Open data gaps: finance lease liabilities, the effect of receivable sales on cash flow, and the fourth quarter cash flow.