Hims & Hers Health Stock Trades Below The Market On Revenue And Above It On Cash

The gap between its revenue multiple and its cash multiple is margin, and the company is spending it on purpose.

Hims & Hers Health (HIMS) sells subscription health care to nearly 3 million people, and its stock trades around $31 a share, about 50% below its 52-week high. Against the S&P 500, the valuation reads two ways at once: cheaper on revenue, more expensive on cash flow. Both readings are correct, and the distance between them is the decision.

Each Revenue Dollar Reaches Cash At Less Than Half The Market’s Rate

On revenue, the stock carries a price-to-sales ratio of 2.8 against 3.3 for the S&P 500. On operating cash flow it sits at 27.3 against 15.5. Those are the same share price over different lines, and what sits between them is conversion. Hims & Hers turned 10.2% of revenue into operating cash flow over the trailing twelve months against 21.8% for the market, about $0.3 billion on $2.6 billion of revenue. A discount on revenue is only a discount if the revenue reaches cash.

Gross Margin Fell About Six Points And Management Expects It To Stay Lower

The revenue the company is adding is deliberately lower-margin. Gross margin in fiscal Q2 2026 was 64%, down about 6 points quarter over quarter on an adjusted basis. By the company’s own account, it will remain below the levels historically achieved as branded weight loss products and international revenue grow as a share of the business. International revenue rose more than 17-fold year over year in fiscal Q2 2026. In June 2026, the company closed its acquisition of Eucalyptus, adding further scale to that business.

The company has a relationship with Novo Nordisk and says it is among the largest players providing access to the Wegovy pill. On a trailing twelve-month basis, the operating margin is deeply negative at -6.0%, compared with 18.4% for the S&P 500. Growth that arrives with an operating loss attached is a different proposition from the growth delivered by the businesses the Trefis High Quality Portfolio holds, where revenue growth comes alongside strong margins rather than instead of them.

Watch Whether Cash Follows The Revenue In The Second Half Of 2026

Fiscal Q2 2026 shows both sides. Revenue grew nearly 40% year over year to more than $753 million and adjusted EBITDA was $60 million, an 8% adjusted EBITDA margin, against a GAAP net loss of $86 million in the same quarter. Free cash flow was negative $68 million, a pause inside a trailing year whose operating cash flow stayed positive, and management attributes it to working capital behind the branded weight loss offering. Management expects free cash flow generation to resume in the second half of 2026; that resumption is what would start closing the gap between the two multiples, and its absence is what would widen it.

Two things sit outside that arithmetic. The Federal Trade Commission filed a complaint on July 29, 2026, which the company is contesting, and the stock’s behavior in a market break is not one story: it fell 54% in the 2022 inflation shock against the S&P 500’s 24%. A read that scores growth, profitability, risk and price together is the way to weigh those factors at once rather than one at a time.

Buy It Or Fear It, How Much Of It Should You Own?

Whichever way the call lands, the bigger question is how much of any single stock belongs in a portfolio at all. A position that has grown large enough to matter is worth sizing deliberately rather than by accident. What a position that size would do to your net worth is exactly what the Trefis Wealth team computes, with the same rules-based systematic discipline that runs our High Quality Portfolio. Request a free vulnerability audit of your biggest positions.