Weekly Tech Talk: Q1 Earnings Going Well So Far; HIMS & DOCS Up Next

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Weekly Tech Talk: Q1 Earnings Going Well So Far; HIMS & DOCS Up Next

HCIT basket. This quarter, aside from WAY's digital billing hiccup, earnings for HCIT companies Source: Jefferies, FactSet

have been positive catalysts, driven by Q1 beats and upward guidance revisions. We note that the

most disliked companies tended to rally the hardest on good news -- while Waystar (one of the

more popular names in the bucket) sold off by over 20% on a beat on the quarter and reiteration

of FY guidance -- underscoring how negative positioning in the group has set earnings bars low

heading into Q1 prints.

HIMS Shares Running Up On Potential FDA Leadership Changes Ahead Of Monday's Earnings

Release. We were surprised to see HIMS shares rally by more than 10% on Friday, which we attribute

to media reports speculating about a potential firing of FDA Commissioner Marty Makary, who has

been hostile to the drug compounding industry. Although it would be nice for HIMS if the FDA moved

in a more compounding-friendly direction on GLPs, we think HIMS is likely locked into its decision

to move to branded-only offerings and leadership changes at FDA should not materially affect

future earnings. This late-day move, along with the recent rally driven by regulatory movements on

peptides has us concerned headed into earnings on Monday, especially if mgmt points to the low

end of EBITDA guidance (or lowers the guide) due to the financial impacts of their strategic shift

on GLPs (i.e., removing compounded GLPs from the weight loss offering and shifting to branded

drug distribution for Novo's GLP suite).

Doximity Earnings, All Eyes On The F27 Guidance. DOCS reports Wednesday after market close,

and we are watching guidance for the top-line growth rate, specifically the timing of that growth.