Seeking Alpha's $111 bull case for Hims & Hers is unconvincing against the WAIT thesis

What happened

A new Seeking Alpha article calls Hims & Hers a 'healthcare behemoth' with a $111 price target, citing 38% Q2 revenue growth and strong Q3 guidance, but the latest DeepValue master report maintains a WAIT rating at $27.39, highlighting that gross margin fell to 64% from 76% and Q2 produced a net loss of $86.3 million. The article celebrates multiple product lines surpassing $100M ARR and rapid vertical launches, yet it fails to address the FTC lawsuit targeting the company's acquisition engine or the margin compression from the branded weight-loss pivot. While revenue growth is real, the company's profitability has deteriorated sharply, and the master report's scenarios suggest fair value closer to $29 in a base case. The article appears promotional, omitting key risks such as branded GLP-1 procurement costs and potential FTC-driven operational restrictions. Overall, the new piece adds no material information that would change the cautious stance.

Implication

Investors should not buy at current levels despite the bullish article, because the market already prices in strong revenue growth while gross margin remains compressed and litigation risk is unresolved. The master report's WAIT rating with an attractive entry around $23 remains prudent, and the bullish case requires proof that branded GLP-1 demand can stabilize margins above 64% and that the FTC case imposes no structural damage to customer acquisition. Over the next 3-6 months, monitor Q3 revenue, gross margin, and any court disclosures before considering a position. The $111 price target appears disconnected from the current fundamentals and ignores the increased liabilities and negative free cash flow. A more reasonable upside scenario values the stock at $38 if everything goes right, still far below the article's target.

Thesis delta

The new article does not shift the thesis; it simply restates the bullish platform-growth case without addressing the deepening losses, margin compression, and FTC litigation highlighted in the master report. The WAIT rating stands because the market already credits strong subscriber growth while the economics have weakened materially. No change in conviction or rating is warranted based on this promotional piece.