Shares of Hims & Hers Health (HIMS) rallied on Tuesday after the telehealth company said it would begin selling branded versions of Eli Lilly’s (LLY) popular weight loss drug tirzepatide. This drug is sold as Mounjaro for Type 2 diabetes and Zepbound for obesity and has helped make Eli Lilly the most valuable drug company in the world. Hims also added generic versions of liraglutide—sold by Novo Nordisk (NVO) as Saxenda and Victoza—for weight loss and diabetes. Still, Bank of America isn’t convinced that this news will make a big difference financially.
4.6-star analyst Allen Lutz said that tirzepatide likely won’t bring in much money for Hims, especially since Eli Lilly sells it for $500 per month on its own platform, while Hims lists it at a much higher $1,899 per month. Nevertheless, Hims said that the goal is to offer a full range of weight management options. “We’re weaving all of these tools together to provide access to a truly comprehensive care experience,” said Craig Primack, Senior Vice President of Weight Management at Hims. The announcement also comes after the FDA said that the shortage of semaglutide—used in Ozempic and Wegovy—is officially over.
The shortage had allowed Hims to launch cheaper compounded versions of the weight loss drug in 2024, but with that gone, Hims can no longer offer these cheaper alternatives. Interestingly, though, Lutz said that if Hims can successfully sell liraglutide, even though it’s less effective and has more side effects than newer drugs, “it would represent a significant milestone and validate the strength of HIMS’ brand.” Still, the bank kept its Underperform rating and $22 price target on the stock.
Which Weight Loss Stock Is the Better Buy?
Turning to Wall Street, out of the three stocks mentioned above, analysts think that NVO stock has the most room to run. In fact, NVO’s average price target of $102.17 per share implies more than 50% upside potential. On the other hand, analysts expect the least from LLY stock, as its average price target of $1,022.71 equates to a gain of 28%.
