HIMS to Acquire Apostrophe; Shares Dip Over 3%

Hims & Hers Health (HIMS) has announced its intention to acquire teledermatology specialist Apostrophe as part of the company’s continuing excellence-based category expansion. Financial details of the deal have not been disclosed so far.

Meanwhile, shares of the company dipped 3.2% to close at $10.75 on Thursday.

Hims & Hers Health is a telehealth company that sells prescription and over-the-counter drugs online, along with personal care products. (See HIMS stock chart on TipRanks)

CEO and co-founder of Hims & Hers Andrew Dudum said, “In the seven years since its founding, Apostrophe has built a brand that, like Hims & Hers, has attracted and heavily engaged GenZ and Millennial consumers. With this investment, we will accelerate our dermatology business, offering highly personalized dermatology treatments at scale.”

CEO and co-founder of Apostrophe Ben Holber said, “Joining a world-class organization like Hims & Hers, will now allow us to help patients, at scale, improve their skin health.”

The Apostrophe team will integrate with the HIMS dermatology business line, with Ben Holber reigning as the CEO of the business line and reporting directly to Hims & Hers COO, Melissa Baird.

Piper Sandler analyst Sean Wieland recently reiterated a Hold rating on the stock with a price target of $11, implying 2.3% upside potential from current levels.

Amazon Pharmacy’s new offering of six-month prescription purchasing options, beginning at $6 for common ailments, has intensified competition in the direct-to-consumer online pharmacy space for HIMS and its peers.

Wieland believes this move signifies a potential headwind for HIMS and may hamper growth for the company’s new offerings.

With 3 Buys and 2 Holds, the stock has a Moderate Buy consensus rating. The average Hims & Hers Health analyst price target of $13.75 implies 27.9% upside potential from current levels. Shares have lost 31.4% year-to-date.