$Hims & Hers Health Inc.(HIMS)$ can easily become a $100 billion company in the next decade.

1. $Hims & Hers Health Inc.(HIMS)$ can easily become a $100 billion company in the next decade.

It's revolutionizing the telemedicine market by offering customized drugs for each patient.

Here is everything you need to know about $HIMS, business, investment thesis, financials, everything.

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2. Many people get $Hims & Hers Health Inc.(HIMS)$ wrong.

It's not a direct-to-consumer (D2C) generic drug provider.

Its business provides patients with primary care visit for just $39. It then prescribes and fulfills the treatment with an option to personalize the treatment for each patient.

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3. $HIMS saw its revenues explode.

Revenues grew at 70% CAGR in the last 5 years, validating the business model.

Its low cost visit+treatment model specifically attracts those who can't afford private healthcare. It exerts a significant competitive pressure on legacy names.

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4. Yet, the total addressable market remains huge.

Research firms expects the US telehealth market to reach over $400 billion by 2033.

Even if just 10% of this market could be attributed to direct-to-consumer segment, $Hims & Hers Health Inc.(HIMS)$ has over $40 billion market to expand into.

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5. $HIMS free cash flow is exploding.

It's not just growing, it's growing profitably. Its free cash flow already tripled year-over-year and we are yet to end 2024. FCF margin is also doubled from 6.5% to 13%. It's not just growing the top line, it's printing cash.

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6. It has a fortress balance sheet. It literally has no debt.

There is only $11 million debt on the balance sheet against $440 million equity. Its annual EBITDA of $60 million can pay all the debt in two months. It has a broad legroom to deploy capital for further growth.

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7. Personalized plans constitute a significant competitive advantage.

It has over 1 million subscribers on personalized plans. It's really hard to convince them to leave $Hims & Hers Health Inc.(HIMS)$ for other generic solutions. As it increases portion of personalized plans, its moat also expands.

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8. $Hims & Hers Health Inc.(HIMS)$ has significant room for expansion.

It's still not active in sleep, diabetes, fertility and cholesterol. These markets collectively create a $121 billion opportunity. $HIMS will surely enter and expand in these markets.

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9. Valuation is still attractive.

It currently has 50% market share in the US D2C telemedicine market. Even if loses some market share and only owns 40% of the market, it'll generate $16 billion revenue. At 20% profit margin, it'll generate $3.2 billion net income. Attach a conservative 30 PE and we have a $100 billion company. It's just beginning.

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Source: https://x.com/thexcapitalist/status/1863981194754293913