Sometimes who is more important than what. When names like Warren Buffett make investment decisions, buying or selling, it tends to catch the attention of the entire investment community. Investors don’t care what they bought/sold, what matters is Buffett.
Buffett is what we deem a franchise investor, even people who don’t eat there know of McDonalds. Non-investors have heard of Buffett. However, the tech-age has unleashed a bunch of really smart people loaded with money that don’t carry the same brand recognition as the Omaha Oracle.
For example, we highlighted Dustin A. Moskovitz and his recent buying spree of Asana, Inc. (ASAN) in this very report. Moskovitz was a key player at Facebook, Inc. (FB) and when he started to load up on ASAN, we noticed. (1) Not because of ASAN, but because of Moskovitz. The stock was in the $40s when we first noticed his activity and then brought it to you; today it’s closing in on $100. Of course, they all don’t work that way.
Like Dustin A. Moskovitz then, the name David Wells carried a faint memory behind some time gone by brain fog. The baseball pitcher? Nah, that’s sports. And Google says, ahh yes that’s right, he was the one-time Chief Financial Officer (CFO) at Netflix, Inc. (NFLX) during their hyper growth stage.
Unlike Buffet, Moskovitz, Wells, and many others fly under the radar, making insider purchases that aren’t mentioned by the talking heads on CNBC. Another parallel between Moskovitz and Wells is that neither had much of a history as insider buyers; they were primarily sellers in their previous roles. As much as we respect Mr. Buffett, the truth is the likes of Moskovitz and Wells are in better tune with today’s technology landscape.
So, when the ex-Netflix exec buys nearly $3 million of Hims & Hers Health, Inc. (HIMS) (2), we can’t notice the who and then investigate the what.
Hims & Hers Health, Inc. operates a multi-specialty telehealth platform that connects consumers to licensed healthcare professionals. The company offers a range of health and wellness products and services available for purchase on its websites directly by customers. It provides prescription medication on a recurring basis and ongoing care from healthcare providers; and over-the-counter drug and device products, as well as cosmetics and supplement products, primarily focusing on wellness, sexual health, skincare, and hair care.
As it is now, Wall Street anticipates strong revenue growth in 2022, with sales increasing nearly 27% to $322.1 million from $253.89 million this year. Meanwhile, losses are expected to narrow to -$0.16 per share next year from a loss of $0.37 this year. (3) Analysts have a one-year consensus price target of $12.25, or roughly 45% upside based on its current price of $8.54. (4) There could be more upside as shares hit a 52-week high of $25.40.
Overall: Hims & Hers Health, Inc. (HIMS) is an aggressive growth play in the personal care market. Although revenue is forecasted to increase sharply, profits are yet to materialize. Wall Street’s price target offers an attractive potential return and Wells’ $3 million buy adds confidence because of his previous success at Netflix.
HIMS is only appropriate for investors with well above average risk tolerance and at least a two-year time horizon.
1 – https://www.secform4.com/insider-trading/1549917.htm
2 – https://www.secform4.com/insider-trading/1507645.htm
3 – https://finance.yahoo.com/quote/HIMS/analysis?p=HIMS
4 – https://finance.yahoo.com/quote/HIMS?p=HIMS&.tsrc=fin-srch