Barclays Targets $25 on Hims & Hers After 28.4% Q4 Revenue Growth
Barclays set a $25 price target on Hims & Hers, implying a 57.18% upside from current levels, following a 28.4% year-over-year revenue increase to $617.8 million in Q4 2025. However, gross margin contracted by 487 basis points to 71.9%, tempering investor optimism.
1. Q4 2025 Financial Highlights
Hims & Hers reported Q4 revenue of $617.8 million, a 28.4% increase year-over-year, driven by strength in its online channel and a subscriber base of 2.5 million. Quarterly EPS came in at $0.07, beating estimates by five cents but down from $0.11 a year earlier, reflecting both top-line momentum and margin pressures.
2. Analyst Price Target Increase
Barclays raised its price target to $25, suggesting potential upside of 57.18% from the current share price. The bullish outlook reflects confidence in continued revenue growth and market share gains in the telehealth sector.
3. Margin Contraction Analysis
Gross margin fell by 487 basis points to 71.9%, due to increased promotional spending and higher cost of goods sold as the company scales its subscription services. Management noted that investments in customer acquisition and fulfillment are impacting near-term profitability.
4. 2026 Revenue Guidance and Outlook
Hims & Hers forecasted full-year 2026 revenue between $2.7 billion and $2.9 billion, implying continued mid-teens growth. Investors will watch the company’s ability to balance growth investments with margin expansion as it competes in the digital health market.