Hims Stock Plummets as Visa Flags Disputes Over Weight-Loss Subscriptions

Hims & Hers Health (HIMS) stock dropped by 8% on Monday, marking its worst day in nearly a month. The decline follows a report from Visa that flagged a surge in credit card disputes related to Hims' weight-loss subscriptions. According to internal documents cited by Bloomberg, 75% of the company's credit card disputes stemmed from its weight-loss memberships.

The Visa action adds to an ongoing controversy over Hims' billing and cancellation practices, which have been criticized by regulators and customers alike. In July, the Federal Trade Commission (FTC) sued Hims along with Utah and Los Angeles County, alleging that the company failed to make recurring subscriptions sufficiently clear, created unnecessary barriers to cancellation, and shared private customer information with Meta Platforms and Snap for advertising.

Despite the controversy, Truist raised its price target on Hims to $32 from $27, implying a 3% upside from current levels. The firm cited 'stronger-than-expected retention' among existing compounded GLP-1 customers as a key factor in its revised outlook.