Why Hims & Hers Health Inc. (HIMS) Crashed On Tuesday?

We recently published a list of 10 Firms Heavily Hit by Market Pessimism. In this article, we are going to take a look at where Hims & Hers Health Inc. (NYSE:HIMS) stands against other firms heavily hit by market pessimism.

Wall Street finished in the red territory on Tuesday, as investors repositioned their portfolios ahead of the Fed rate decision on Wednesday.

The Nasdaq dropped the highest among its peers, declining 1.71 percent. The S&P 500 followed with a 1.07-percent loss, while the Dow Jones decreased by 0.62 percent.

The market pessimism spilled over to various sectors, with 10 companies notably hit the most.

In this article, we have identified the 10 worst performers on Tuesday and detailed the reasons behind their drop.

To come up with the list, we only considered the stocks with a $2-billion market capitalization and $5 million in trading volume.

A nurse in a telehealth platform talking with a patient on video call for consultation.

Hims & Hers Health Inc. (NYSE:HIMS)

Hims & Hers saw its share prices decline by 9.22 percent on Tuesday to close at $31.49 as investors soured on an investment bank’s price target for the company.

On Tuesday, Bank of America raised its price target for HIMS by $1 at $22 per share, but despite the higher target, the figure represented a 30-percent downside from HIMS’ Tuesday closing price.

In addition, Bank of America also assigned an “underperform” rating on HIMS.

Last month, HIMS saw a spike in sales from the Super Bowl event, but investors now doubt that it would sustain its momentum following the Food and Drug Administration’s (FDA) announcement that the bestselling Wegovy and Ozempic by HIMS’ competitor Novo Nordisk are now back in sufficient supplies and out from the shortage list.

It can be learned that HIMS has been making a compounded knock-off version of the two treatments.

Overall, HIMS ranks 7th on our list of firms heavily hit by market pessimism. While we acknowledge the potential of HIMS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as HIMS but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.