Hims & Hers (HIMS) shares tanked more than 30% on Monday after pharmaceutical behemoth Novo Nordisk (NVO) terminated its distribution agreement with the telehealth company.
Novo Nordisk agreed to a high-profile partnership with HIMS to distribute Wegovy, its blockbuster weight-loss treatment.
But the Danish giant axed that deal today, citing concerns that Hims & Hers has been selling unapproved compounded formulations of that drug on its online platform.
Including today’s plunge, Hims & Hers stock is down more than 35% versus its year-to-date high.
What Losing Novo Nordisk as Partner Means for HIMS Shares
Novo Nordisk’s announcement this morning is disconcerting for Hims & Hers investors because the deal was broadly seen as the latter’s gateway into the booming weight-loss market.
Offering access to Wegovy via a $599-per-month bundled plan could have resulted in a meaningful boost to its revenue, especially as GLP-1 drugs reshape obesity care.
However, not only did the telehealth firm lose that growth catalyst today, it now faces reputational damage and regulatory scrutiny as well over its compounded drug practices.
Together, this could make it incrementally more difficult for HIMS shares to recover in the second half of 2025.
BofA Sees Significant Further Downside in Hims & Hers Stock
Investors should practice caution in buying the dip in Hims & Hers stock on Monday also because – even without the loss of Wegovy – the company’s management guided for weaker-than-expected Q2 sales.
In May, the telehealth firm said its revenue will fall between $530 million and $550 million in the second quarter – short of the nearly $565 million that experts had forecast.
And now that HIMS has lost Wegovy deal as well, its financials will likely take a more pronounced hit moving forward. That’s part of the reason why BofA currently rates Hims & Hers shares at “Sell.”
Its analysts’ $28 price target on the San Francisco-headquartered firm warns of another 35% down side from here.
Should You Buy the Dip in Hims & Hers Today?
The consensus rating on Hims & Hers stock currently sits at “Hold” only.
While analysts have a mean target on HIMS set at about $48 at writing, suggesting potential upside of more than 10% from here – investors should note that they could downwardly revise their estimates following NVO news in the coming weeks.
