Barclays raises its target sharply to $39 as the shares break through $30 resistance
Sell-side views have split to an extreme (Leerink $25 vs Barclays $39), and Barclays is now the most aggressive bull among the analysts covering the stock. Its view: alt-data show a clear inflection since the Novo Nordisk partnership, and the weight-loss business will drive faster revenue growth in the second half.
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On 17 Jun the shares moved above the key $30-32 resistance zone (which has repeatedly capped them since April), and the technical significance outweighs the day's gain. But this rally is mainly down to the alt-data inflection from the Novo partnership, a technical repair as resistance broke, and Barclays igniting sentiment. It is not a new fundamental turning point. The FDA advisory committee on peptide compounding on 23-24 Jul is still the core binary event.
Key evidence
- Barclays research note, 16 Jun: target raised from $29 to $39 (Overweight maintained), implying about 21% upside and among the highest targets in coverage
- Barclays's logic: alt-data show a clear inflection since the Novo Nordisk partnership. Weight loss and other modest contributors will together drive faster revenue growth in the second half, creating a chance of a 'breakout in the shares'.
- In the same week Leerink reiterated Market Perform with a $25 target, the polar opposite of Barclays's $39
- The core disagreement: the near-term earnings trajectory of GLP-1 versus a long-term re-rating of the platform and peptides
- Closed at $31.47 on 17 Jun (+4.31%), touching $32.22 intraday, up about 13% over the week
- $30-32 is the resistance zone that has repeatedly capped the shares since April. This time they broke above it and held.
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- Above the 20-day ($26.60) and 50-day ($26.07) moving averages, but still well below the 52-week high of $70.43
- FirstWave Fund CEO Jonah Lupton publicly estimates HIMS's annual peptide revenue potential at $10 billion to $19 billion (a personal view, not company guidance)
Catalysts to watch
- FDA advisory committee meeting on peptide compounding, 23-24 Jul (the core binary event)
- Continued confirmation from alt-data on the Novo Nordisk partnership
- Visibility on revenue acceleration in the second half (Barclays's focus)
Risks
- Lupton's estimate of $10 billion to $19 billion in peptide revenue assumes FDA PCAC clearance on 23-24 Jul. It is an upper-bound assumption for an optimistic scenario.
- Even if the advisory committee votes in favour, the FDA still has the final say
- This rally is not a new fundamental turning point. It is mainly technical repair plus a spark to sentiment.
- Sell-side views have split to an extreme ($25 vs $39), so there is no consensus
- Still well below the 52-week high of $70.43, and the path to a long-term re-rating is unconfirmed
Sources (5)
- Barclays research note, 16 Jun
- Leerink reiteration of Market Perform
- Intraday price data, 17 Jun
- Public comments by FirstWave Fund CEO Jonah Lupton
- Alt-data on the Novo Nordisk partnership
A brief is a lead for our research, not a verified conclusion or advice.