Variables

• Relative Volume: >= 3
• Gap: >= 3%
• Average True Range: >= 1.0
• Average Volume: >= 1M
• News catalyst that is unusual and unexpected.
• Significant changing fundamentals: margin, full year guidance, goverment investigation, core of the business is improving, new product.
• Below long term technical key level.
• Holding above VWAP or the opening range.
• Battle develops on the level 2 or key levels matching thesis.
• Tight spread displayed premarket and on open.
• Stock correlates with the overall market performance: QQQ, SPY or RSP
• Stock correlates with the sector performance.

Long Strategy

• Stop Loss is below the low of the consolidation.
• Hold long for a real move, Trade2Hold.
• Add on shallow pullbacks with low volume.
• Add when holding above a key level.
• Cover into significant resistance levels from the daily.
• Look for an over extented move to the upside on high volume to signal exhaustion and a place to take final covers.

Big Picture

Trump said he would announce pharma tariffs over the next two weeks. U.S. stocks rose after the opening when it was announced that Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer would meet with China’s top economic official later this week.

Intraday Fundamentals

Hims shares are up more than 260% over the past 12 months. The company sells mostly generic and compounded medicines online, pairing cheap, older drugs for cash payers with intensive marketing campaigns. Its business has been transformed over the past year by its entry into the weight loss market. Early in 2024, it started offering a legal knockoff version of Novo Nordisk’s Wegovy manufactured by a compounding pharmacy. Hims sold the medicine, called compounded semaglutide, for a fraction of the list price of Novo’s version.

• Hims & Hers announced a long-term collaboration with Novo Nordisk to make obesity care and treatments more accessible, affordable and connected for Americans.
• Telehealth company Hims & Hers reported first-quarter results that beat Wall Street estimates. But parts of the company’s forecast came in below estimates, and looming worries about the company’s growth as the era of cheap, legal knockoff weight loss drugs comes to an end.
• In the quarter under review, Online Revenues of $576.4 million reflected a surge of 115.3% year over year on a reported basis.
• During the reported quarter, subscribers were 2.4 million up 38.4% year over year. This was primarily driven by increased traffic to Hims & Hers’ platform (through websites and mobile applications), resulting from marketing activities and improved onsite and customer onboarding experiences.
• Monthly online revenue per average subscriber increased 52.7% year over year to $84 in the first quarter.
• The stock was down as much as 7.5% in premarket trading, but rebounded as the market opened. Shares are up 7.8% to $45.14 in morning trading.
• RVOL: 11.67
• ATR: 4.14
• Avg Volume: 30.58M
• Institutional Ownership: 71.38%
• Short Float: 33.08%
• Day Range: 48.50 - 38.21 = 10.29
• VIX: 24.22

Technical Analysis

Trade Management

Expected Value

• EV = (Reward * Win Probabilty) - (Risk * Loss Probability)
• EV = (7 * 0.65) - (1 * 0.35)
• EV = 4.2 (A+ Trade)

Recording

Trade Review

• Entered too early, the EMA9 did not cross the VWAP yet. Used the order type limit instead of stop limit, which executed immediatly at a better price.
• Missed to adjust the share amount from 200 to 140 after hitting the first sell limit order. Later when stopped out in profit I was short 60 shares. That is not acceptable and needs my full attention.
• This trade should be a Trade2Hold, but instead of keeping a core postion and let it develop, I exited the whole position.
• A rare opportunity, changing fundamentals with a great fashionably late setup. Many checks in favor, high probability and great risk reward ratio. An A+ trade, should have risked much more. During the day there were many opporunities to reenter.
• Learned that the Fashionably Late setup works great with Changing Fundamentals. And that a fresh news catalyst increases the success rate a lot for all setups. In many cases the stock will be in play.