Hims & Hers Short Interest Nears All-Time High, Buy The Dip?

Key Points

• Hims & Hers stock is falling well off its 52-week highs, as bears lean on the CEO's just-concluded scheduled sale, which might be a mistake.
• Wall Street analysts are still bullish on the company's price target, calling for double-digit upside.
• Institutions bought multi-million dollar stakes in the stock in the past quarter.

Shares of Hims & Hers Health Inc. NYSE: HIMS have been the hottest thing in the medical sector, and for good reason. The company's fundamentals are highly attractive for investors who prefer to acquire growth stories early, before they become too large to price in further expansion.

At just $10 billion in market capitalization, Hims & Hers is definitely not too big.

The stock has declined about 11.4% over the last month, clearing out less committed investors. However, this decline also creates an opportunity for dip-buyers, as the stock now trades at only 65% of its 52-week high.

This deep move into bear territory has reignited short-seller confidence, pushing short interest near record levels. Yet, that same setup could present a significant opportunity for contrarian investors.

If the stock regains momentum and begins to rebound, short sellers may be forced to cover their positions—potentially triggering a powerful short squeeze and fueling a sharp rally in Hims & Hers shares in the months ahead.

However, not everything is rosy for the company: part of the recent dip is due to the CEO, Andrew Dudum, selling a block of stock, which could worry some investors regarding insider confidence.

CEO Stock Sale Was Pre-Planned—Not a Red Flag

This was a scheduled sale for about $11 million in total, set up in August 2024, so it is not an unexpected or spontaneous event for the company. Therefore, it shouldn't be a reason for shareholders to worry too much about the CEO.

Perhaps leaning on the bearish price action and this CEO news, short sellers felt confident enough to raise their stakes, betting on the share price, which is why the company's interest rose to a high of $4 billion as of September 2025, nearing the all-time high.

For reference, July 2025 marked the highest level of short interest for Hims & Hers stock at just under $4.3 billion. Nonetheless, this still represents 31.4% of the entire stock float, which is a high-conviction call that this CEO's event is deeply bearish.

What investors can take from this is a straightforward assumption. However, it can be a defining moment for their portfolios.

If the market is wrong about this scheduled sale, there's a good chance Hims & Hers stock will return to previous highs, if not break through a new ceiling. Investors are now tasked with determining whether this will happen, and there are a few ways to do so.

Wall Street Sets Bold Price Target Above $60

All company valuation multiples are based on future expected growth, which drives Hims & Hers' valuation to 59.3x price-to-earnings (P/E), a significant premium above the medical sector's current 29.6x.

Even after the sell-off, markets are still willing to place the company above its peers, and here's why.

Looking at the company's quarterly earnings, a few drivers stand out that justify the premium markets are paying today. First, revenue growth of 73% on an annual basis, which, of course, carries an industry-leading gross profit margin of 76.2% over the past 12 months.

More than just high revenue growth, it's the company that generates this stream of income. Through subscriptions, Hims & Hers can generate stable, predictable cash flow for management to reinvest in further growth, which is always good news for value compounding and shareholder benefits.

The reported net earnings per share (EPS) figure quantifies that benefit, which came in at 17 cents, up from 6 cents a year prior. Seeing EPS nearly triple in a single year justifies the premium. However, this is old news; investors need to see something in the future to feel comfortable with a potential recovery.

While the most immediate catalyst is the market's sizing of why the CEO's sale actually took place, here's a more quantifiable metric. The latest price target from Wall Street is from Maria Ripps at Canaccord Genuity Group, who sees the stock rising to $68 per share, roughly 43% above today's price.

That bold call also stands above the consensus at $38.92, so conviction isn’t an issue for this analyst. In other news, Hims & Hers reports $19 million in institutional buying over the past quarter, suggesting the “smart money” is likely taking advantage of this pricing mistake amid the CEO sale.

This is far from a risk-free bet, but after falling this much from highs on a shaky bear market foundation, the risk-to-reward ratio for Hims & Hers seems one of the best investors could have going into the end of 2025.