HIMS stock spikes over 40%; Time to buy?

Core Viewpoint - Hims & Hers Health's stock surged by up to 45% following the announcement of a partnership with Novo Nordisk to offer Wegovy through its platform, indicating strong investor interest in the company's growth potential in the weight-loss medication market [1][5]. Stock Performance - In pre-market trading, HIMS stock rose as much as 45% to $41, later stabilizing at a 26% increase to $36.17 at the time of reporting [2]. - The stock has experienced a 43% year-to-date increase, reflecting positive market sentiment [4]. Partnership Details - The partnership allows Hims & Hers to offer Wegovy prescriptions starting at $599 per month via NovoCare Pharmacy, expanding access to a high-demand weight-loss medication previously available only through local pharmacies [5]. - This collaboration is expected to unlock a significant new revenue stream for Hims & Hers, which has been growing its subscription-based health offerings [6]. Market Demand - The move positions Hims & Hers to capitalize on the increasing demand for weight-loss medications, particularly GLP-1 drugs [7]. Analyst Reactions - Despite the positive news, several Wall Street analysts downgraded HIMS stock, citing limited near-term upside and potential speculative trading [8][9]. - Morgan Stanley reduced its price target from $60 to $40 while maintaining an 'Equal Weight' rating, emphasizing the need for clear progress in Hims' core business [9]. - TD Cowen downgraded HIMS to 'Hold' from 'Buy', cutting its target to $30, and raised concerns about competition and the achievability of the company's $725 million weight-loss revenue target [10]. - Citi reaffirmed its 'Sell' rating and lowered its price target from $27 to $25, highlighting risks related to slowing core revenue growth and broader market pressures [11].