Hims & Hers initiated with a Market Perform at Leerink

Leerink analyst Michael Cherny initiated coverage of Hims & Hers with a Market Perform rating and $10 price target. The firm believes Hims & Hers has done “a remarkable job” scaling its business in a very short timeframe. Offering a differentiated user interface to a tech oriented member base for specific/easy to diagnose conditions has allowed Hims & Hers to markedly outperform its initial SPAC targets and show sustained upside to consensus estimates. This has also allowed the company to get to EBITDA breakeven faster than expected, with more scaling opportunity beyond the current baseline, Leerink adds. With that being the case, the firm sees the magnitude of unexpected upside as more limited, leaving most of the medium-term upside as priced in at current valuation. Leerink is not expecting business deterioration – just fewer upside catalysts.