What Happened?

Shares of telehealth company Hims & Hers Health (NYSE: HIMS) fell 29.2% in the morning session after Novo Nordisk, the maker of the weight loss drug Wegovy, announced it would terminate its agreement with the company (Hims & Hers). 

The surprise move came just months after the two expanded their deal, letting Hims & Hers sell Wegovy directly. Novo Nordisk said it pulled out because Hims & Hers may have broken the rules "by engaging in deceptive promotion and selling of illegitimate, knockoff versions of Wegovy that put patient safety at risk." 

Losing this deal is a hard hit for Hims & Hers, since weight loss drugs have been a big part of their recent sales growth.

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What The Market Is Telling Us

Hims & Hers Health’s shares are extremely volatile and have had 94 moves greater than 5% over the last year. But moves this big are rare even for Hims & Hers Health and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 7 days ago when the stock gained 7.2% on the news that the major indices rebounded (Nasdaq +1.5%, S&P 500 +1.0%) as reports pointed to easing tensions between Israel and Iran. The Wall Street Journal said senior Iranian officials had signaled a willingness to restart stalled nuclear talks, on the condition that Washington refrain from joining Israel's ongoing strikes. This development triggered a significant decline in oil prices, easing inflation concerns. Also, it is possible some investors were buying the dip following the sell-off at the end of the previous week.

Hims & Hers Health is up 81.9% since the beginning of the year, but at $45.83 per share, it is still trading 33.3% below its 52-week high of $68.74 from February 2025. Investors who bought $1,000 worth of Hims & Hers Health’s shares 5 years ago would now be looking at an investment worth $4,520.

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