HIMS US · Hims & Hers Health, Inc.MW GOBLIN RESEARCH

HIMS: Margin and cash validation come before revenue recovery

Analysis date Sep 30, 2026

Published September 30, 2026 at 16:58 KST

MW GOBLIN · AI company research

Key Takeaway

As of 2026-09-30, the stance is wait and see. A recovery in U.S. weight-management demand is positive, but declining profitability and acquisition-payment burdens constrain improvement in per-share value. At the queried share price of $28.78, margin recovery and cash generation after investment are needed to support an undervaluation case.

Price used in the analysis28.78 USD

Toss Securities
Quote September 30, 2026 at 16:48 KST
Retrieved September 30, 2026 at 16:54 KST

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Quarterly revenueUSD 753.2 million · +38% year over yearQ2 2026 [1]

Gross margin64% · 76% in the prior-year periodQ2 2026 [1]

Adjusted EBITDACompany annual outlook: USD 275 million–325 million2026-08-10 [2]

Revenue growth has not translated into profit growth

U.S. weight-management demand has recovered, but profit conversion remains weak. In the second quarter of 2026, U.S. revenue increased 16% year over year and total revenue rose 38%; 59% of the increase came from acquisition-driven international businesses. Branded medications and frequent shipping caused gross margin to fall from 76% to 64%. Adjusted EBITDA also declined 27%, so improvement in drug-sourcing and delivery costs, rather than expansion in scale, will determine profit recovery. [1][2]

The cost of acquisition-driven growth is cash outflow or dilution

Growth funding should be assessed by looking at cash generation and dilution together. Subtracting $68.58 million of investment in property, software, and other items from $53.42 million of operating cash in the first half of 2026 gives FCF of −$15.16 million. At the end of June, deferred and contingent acquisition-related payments were $866 million, some of which may be paid in shares. The $400 million receivables-sale facility signed on July 1 also cannot be treated as committed cash, since the bank may refuse to purchase the receivables. [1][3]

Reference multiple including acquisition payments is 27.1x

At $28.78, fixing A- and V-class shares at 233.3 million as of August 7, adding $1.403 billion of convertible-note principal and $866 million of acquisition payments at the end of June, and subtracting $841 million of cash and short-term investments gives a reference EV of $8.142 billion. It excludes leases and is pre-dilution; it is not current EV. At 27.1x the midpoint of the company’s 2026 adjusted EBITDA outlook of $300 million, the case for undervaluation is weak given lower margins and investment spending. No target price is provided. [1][2]

What could change the thesis

Upside condition: achieving the company’s third-quarter adjusted EBITDA outlook of $75–95 million, alongside improvement in gross margin and cash flow after investment.[1,2]
Downside condition: increased settlement of acquisition payments in shares or a burden exceeding the $60 million provision for the FTC lawsuit would lower per-share value and the cash outlook.[1]

Sources and Evidence

SEC 2026 Second-Quarter Form 10-Q ↗2026-08-10 · Cover; pp.1, 5, 12, 26, 30, 40, 44 and 49
Hims & Hers Second-Quarter Results and Full-Year Outlook ↗2026-08-10 · Quarterly results and Financial Outlook
SEC Receivables Sale Agreement 8-K ↗2026-07-01 · Item 1.01: receivables sale agreement

This AI-generated report is for information. Check the analysis date and primary sources. Terms