We assign a fundamental rating of 5 out of 10 to HIMS. HIMS was compared to 103 industry peers in the Health Care Providers & Services industry. Both the profitability and the financial health of HIMS get a neutral evaluation. Nothing too spectacular is happening here. HIMS is valued quite expensively, but it does show have an excellent growth rating.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

HIMS had positive earnings in the past year.
HIMS had a positive operating cash flow in the past year.
HIMS had negative earnings in 4 of the past 5 years.
In multiple years HIMS reported negative operating cash flow during the last 5 years.

1.2 Ratios

With an excellent Return On Assets value of 5.99%, HIMS belongs to the best of the industry, outperforming 82.52% of the companies in the same industry.
HIMS's Return On Equity of 23.03% is amongst the best of the industry. HIMS outperforms 91.26% of its industry peers.
HIMS has a better Return On Invested Capital (5.84%) than 61.16% of its industry peers.

		Industry Rank	Sector Rank
ROA	5.99%
ROE	23.03%
ROIC	5.84%

ROA(3y)-1.82%

ROA(5y)-6.51%

ROE(3y)-0.49%

ROE(5y)-7.04%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

Looking at the Profit Margin, with a value of 6.05%, HIMS belongs to the top of the industry, outperforming 81.55% of the companies in the same industry.
The Operating Margin of HIMS (5.96%) is better than 66.99% of its industry peers.
The Gross Margin of HIMS (75.01%) is better than 90.29% of its industry peers.
HIMS's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	5.96%
PM (TTM)	6.05%
GM	75.01%

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3Y1.84%

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

HIMS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
HIMS has more shares outstanding than it did 1 year ago.
The number of shares outstanding for HIMS has been increased compared to 5 years ago.
HIMS has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

An Altman-Z score of 3.76 indicates that HIMS is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.76, HIMS is in the better half of the industry, outperforming 74.76% of the companies in the same industry.
HIMS has a debt to FCF ratio of 8.13. This is a slightly negative value and a sign of low solvency as HIMS would need 8.13 years to pay back of all of its debts.
With a Debt to FCF ratio value of 8.13, HIMS perfoms like the industry average, outperforming 54.37% of the companies in the same industry.
HIMS has a Debt/Equity ratio of 1.67. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of HIMS (1.67) is worse than 68.93% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	1.67
Debt/FCF	8.13
Altman-Z	3.76

ROIC/WACC0.66

WACC8.9%

2.3 Liquidity

A Current Ratio of 1.88 indicates that HIMS should not have too much problems paying its short term obligations.
HIMS has a better Current ratio (1.88) than 76.70% of its industry peers.
A Quick Ratio of 1.64 indicates that HIMS should not have too much problems paying its short term obligations.
The Quick ratio of HIMS (1.64) is better than 66.99% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.88
Quick Ratio	1.64

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 22.73% over the past year.
Measured over the past years, HIMS shows a very strong growth in Earnings Per Share. The EPS has been growing by 60.35% on average per year.
HIMS shows a strong growth in Revenue. In the last year, the Revenue has grown by 78.02%.
HIMS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 75.77% yearly.

EPS 1Y (TTM)22.73%

EPS 3YN/A

EPS 5Y60.35%

EPS Q2Q%-81.25%

Revenue 1Y (TTM)78.02%

Revenue growth 3Y75.77%

Revenue growth 5YN/A

Sales Q2Q%49.16%

3.2 Future

Based on estimates for the next years, HIMS will show a very strong growth in Earnings Per Share. The EPS will grow by 28.57% on average per year.
HIMS is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 22.77% yearly.

EPS Next Y-12.01%

EPS Next 2Y4.07%

EPS Next 3Y13.84%

EPS Next 5Y28.57%

Revenue Next Year60.27%

Revenue Next 2Y37.46%

Revenue Next 3Y30.81%

Revenue Next 5Y22.77%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 56.07 indicates a quite expensive valuation of HIMS.
HIMS's Price/Earnings is on the same level as the industry average.
HIMS's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.25.
Based on the Price/Forward Earnings ratio of 51.78, the valuation of HIMS can be described as expensive.
HIMS's Price/Forward Earnings ratio is in line with the industry average.
HIMS's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.98.

		Industry Rank	Sector Rank
PE	56.07
Fwd PE	51.78

4.2 Price Multiples

HIMS's Enterprise Value to EBITDA is on the same level as the industry average.
HIMS's Price/Free Cash Flow ratio is in line with the industry average.

		Industry Rank	Sector Rank
P/FCF	57.69
EV/EBITDA	39.02

4.3 Compensation for Growth

HIMS has a very decent profitability rating, which may justify a higher PE ratio.
HIMS's earnings are expected to grow with 13.84% in the coming years. This may justify a more expensive valuation.