Novo Nordisk-Hims Deal Turns Wall Street Bullish — BMO Sees Relief From Commercial Headwinds, BofA Upgrades HIMS Stock

BMO Capital maintained its ‘Market Perform’ rating for Novo Nordisk, with a price target of $45, implying an upside of more than 13% from NVO stock’s closing price on Monday.

• Analysts at BofA nearly doubled their price target for HIMS stock following the company’s deal with Novo.
• The firm now has a price target of $23, up from $12.5, while the rating has been upgraded to ‘Neutral’ from ‘Underperform’.
• The firm stated that Novo dropping its patent infringement lawsuit against Hims is a “clear positive” for the telehealth operator.

Novo Nordisk AS’s (NVO) deal with Hims & Hers Health Inc. (HIMS) has turned Wall Street bullish on both companies, with analysts stating that it helps them in dealing with a commercial headwind and removes a litigation risk from the equation.

According to TheFly, analysts at BMO Capital noted that the Novo Nordisk-Hims deal to sell branded GLP-1 is a significant step forward in helping the Ozempic maker address a commercial headwind.

The firm maintained its ‘Market Perform’ rating for Novo Nordisk, with a price target of $45, implying an upside of more than 13% from NVO stock’s closing price on Monday.

Novo shares were down about 1% in Tuesday’s pre-market trade, while Hims & Hers shares were up nearly 5% at the time of writing. Retail sentiment around HIMS stock trended in the ‘extremely bullish’ territory on the platform.

Why Are Analysts Bullish On HIMS?

Analysts at BofA nearly doubled their price target for HIMS stock following the company’s deal with Novo. The firm now has a price target of $23, up from $12.5, while the rating has been upgraded to ‘Neutral’ from ‘Underperform’.

The firm stated that Novo dropping its patent infringement lawsuit against Hims is a “clear positive” for the telehealth operator. BofA sees the risk-to-reward ratio as balanced now following the deal.

Deutsche Bank also hiked its price target for HIMS to $28 from $25, implying an upside of more than 26% from Monday’s closing price. The firm cited the Novo deal for its price target hike, while keeping a ‘Hold’ rating on the HIMS stock.

What Did Novo, Hims Agree On?

Hims and Novo Nordisk announced a partnership to offer Ozempic and Wegovy at affordable self-pay prices on the telehealth company’s platform.

Hims & Hers also stated that it will no longer advertise compounded GLP-1 offerings on its platform or in its marketing. The company stated that Ozempic injections in doses of 0.5 mg, 1 mg, and 2 mg are covered. It will also include Wegovy injections in 1.7 mg and 2.4 mg doses, while Wegovy pills in 1.5 mg, 4 mg, 9 mg, and 25 mg doses are covered.

It added that these Ozempic and Wegovy offerings will be made available on its platform later this month.

How Did Stocktwits Users React?

One bullish user on Stocktwits believes selling HIMS stock at this point will be one of the “biggest mistakes” of their life. 

Another user stated that every dip in the NVO stock is a “gift.”

NVO stock is down 22% year-to-date, while HIMS stock is down 32%.

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