Hims & Hers stock jumps as Canaccord lifts target price ahead of FDA review

Hims & Hers Health shares HIMS surged 9% on Wednesday after Canaccord Genuity raised its price target on the telehealth company, citing improving sales trends, momentum in its weight-loss business, and growing optimism around its peptide opportunity.

Canaccord analyst Maria Ripps maintained a Buy rating on the stock while increasing her price target to $40 from $32, implying additional upside from current levels.

The upgrade comes after a strong second quarter for Hims & Hers, with the stock gaining approximately 67% during the period.

Canaccord sees improving business momentum

Ripps said Hims & Hers continues to benefit from stronger credit card spending data and the rollout of branded weight-loss medications.

The analyst noted that Hims has become one of Novo Nordisk's largest telehealth partners for weight-loss drugs.

The company also expanded its international presence by launching generic semaglutide in Canada in late May and completed its acquisition of Eucalyptus in early June.

According to Canaccord, credit card spending data showed adjusted year-over-year sales growth improving throughout the quarter, rising from the mid-to-high single digits in April to the high teens by June.

The company generated $2.37 billion in revenue over the last 12 months while posting 33% revenue growth and a 73% gross profit margin.

Canaccord also said improving sentiment around Hims' peptide strategy has become another positive catalyst for investors.

FDA review puts peptide opportunity in focus

Investor attention is now turning to the US Food and Drug Administration's Pharmacy Compounding Advisory Committee meeting scheduled for July 23-24.

The committee is expected to review seven peptides after FDA staff recommended against allowing compounding pharmacies to manufacture them, citing limited evidence supporting their use and unresolved safety concerns.

The peptides under review include BPC-157, Emideltide, Epitalon, KPV, MOTS-c, Semax and TB-500.

FDA scientists said available evidence was insufficient to support compounding and noted that potential safety risks could not be ruled out.

Former advisory committee member Dr. Anita Gupta said earlier reviews identified concerns over immune responses.

"At the time, the FDA presented a lot of adverse event data that showed there was a risk of immunogenicity — immune reactions — and that raised some red flags for the committee."

She also warned about product quality issues, saying some peptide products have shown "heavy metals," "microbial contamination" or mislabeling.

Despite the FDA staff recommendation, Ripps remains optimistic about the longer-term opportunity, noting that the advisory committee's current membership appears more supportive of peptides.

Analysts see decision as key catalyst

Hims has already positioned itself for a potential expansion into peptide therapies.

Earlier this year, the company acquired a California-based peptide manufacturing facility to strengthen its domestic supply chain and support future work in preventive health, metabolic optimization, cognitive performance and recovery science.

Several analysts believe the peptide market could represent a multibillion-dollar revenue opportunity if regulations become more favorable.

Needham analyst Ryan MacDonald described the FDA staff recommendation as unexpected but said it does not represent the final outcome.

"This is not the end of the conversation," he told the Hims House investor community on X, adding that approval odds may be "slightly less," but he is "still operating under the assumption that they will get approved."

MacDonald noted that the advisory committee must still review scientific evidence, hear stakeholder feedback, and make its recommendation before the FDA issues a final decision.

He also said FDA leadership ultimately determines the outcome, while the Department of Health and Human Services oversees the agency, with Health Secretary Robert F. Kennedy Jr. having publicly expressed support for peptide deregulation.