nnarum

$HIMS $100 stock that Investors are willing to lend at 0% interest| Convertible Notes 🧵 Not Financial Advice! DYOR! Valuation is ridiculous at this kind of growth(60-70% FY2026 with Eucalyptus acquisition) P/S : 2.34x Fwd P/S: 1.37x This is clearly pricing in the business to fail or to die. While management found a way to improve working capital without diluting shareholders too much unlike other companies trading at 30x-40x-50x-100x P/S. Even at $100, that would still be cheap for me at P/S : 9.7x Fwd P/S: 5.7x For this kind of potential growth long term. And @MikeLongTerm dont plan to sell it at $100. Hims & Hers Health has issued two significant sets of zero-coupon convertible senior notes that sophisticated investors view as an attractive way to gain leveraged exposure to the company's growth story while enjoying bond-like downside protection. These instruments, issued in May 2025 and May 2026, reflect strong institutional demand for HIMS amid its expansion in telehealth, personalized wellness, international markets, and AI capabilities. The first issuance, in May 2025, raised $1 billion (upsized from an initial $870 million plus a fully exercised option) in 0.00% convertible senior notes due May 15, 2030. The second, completed in May 2026, brought in approximately $402.5 million (upsized from $350 million plus option) in 0.00% notes due June 1, 2032. Both are senior unsecured obligations issued via private placement to qualified institutional buyers under Rule 144A. They carry 0% interest and do not accrete principal, making them true zero-coupon structures. Conversion terms highlight the equity upside embedded in these notes. For the 2030 notes, the initial conversion rate stands at 14.1493 shares per $1,000 principal, equating to a conversion price of about $70.67 per share a 37.5% premium to the $51.40 stock price at the time of pricing. For the 2032 notes, the rate is 33.8590 shares per $1,000, implying a conversion price of roughly $29.53, a 32.5% premium to the $22.29 closing price on May 18, 2026. Holders can convert under specific conditions before set dates (November 15, 2029 for the older notes; March 1, 2032 for the newer ones) and more freely thereafter until shortly before maturity. Upon conversion, Hims & Hers may settle in cash, shares, or a combination, at the company's election. To mitigate dilution, Hims & Hers entered into capped call transactions with financial institutions. The 2030 notes feature a cap around $89.95 (75% premium to the then-stock price), while the 2032 notes have a cap near $50.15 (about 125% premium to the pricing-day price). These hedges, which cost tens of millions, reduce potential share issuance or excess cash payments if the stock rises moderately, benefiting existing shareholders while preserving the appeal for note buyers. Redemption and change-of-control provisions add further structure. Hims can redeem the notes for cash starting in 2028 (2030 notes) or 2029 (2032 notes) if the stock trades above 130% of the conversion price for a specified period. Holders gain put rights at par in the event of a fundamental change, such as a takeover. These features balance issuer flexibility with investor protections. What do these investors see in $HIMS unlike short sellers BS? Investors see these notes as a massive opportunity precisely because of the asymmetric payoff at zero interest cost. By purchasing the notes, they effectively lend capital to Hims & Hers at 0% while receiving a long-dated call option on the stock. If HIMS executes on subscriber growth, international expansion (including the Eucalyptus acquisition), AI-driven personalization, and margin improvement, the stock can rise well above the conversion prices, allowing profitable conversion and equity-like returns. Downside remains protected: at maturity, holders receive full principal in cash unless converted earlier, and the senior ranking provides priority over equity in distress scenarios. This convexity limited downside with uncapped (or capped at a high level) upside appeals especially to convertible arbitrage funds, hedge funds, and growth-oriented institutions. They can buy the note, hedge by shorting a portion of the underlying stock (delta hedging), and profit from volatility or the option's value. The zero coupon lowers the hurdle: investors forgo yield in exchange for participation in HIMS's secular tailwinds in personalized healthcare, where demand for accessible treatments in weight loss, sexual health, hair care, and more continues to expand. Strong demand, evidenced by both offerings being upsized, signals deep conviction that HIMS can compound value and exceed the conversion thresholds over the coming years Proceeds reinforce this alignment. Funds from the 2025 notes supported global expansion, AI investments, and technology infrastructure. The 2026 issuance targets similar goals, including the Eucalyptus deal and operational efficiencies. For a growth company, this represents low-cost, non-dilutive (initially) capital that fuels high-return initiatives without immediate cash interest burdens. If the stock performs well, conversion effectively becomes equity raised at a premium, cleaning up the balance sheet while avoiding large cash repayments in 2030 and 2032. Of course, risks remain. If $HIMS underperforms and the stock lingers below conversion prices, the notes function as low-yielding bonds, creating opportunity cost. Dilution can still occur beyond the capped call thresholds in strong upside scenarios, and accounting requires non-cash interest expense recognition. Market volatility, refinancing needs, or execution missteps could also pressure the notes' trading value. Yet these are standard trade-offs that sophisticated buyers willingly accept given the structure's embedded optionality and HIMS's momentum Hims & Hers' zero-coupon convertible notes exemplify modern hybrid financing for high-growth names. They provide the company with flexible capital to accelerate its vision while offering investors a compelling, protected bet on its future success. For these "senior" investors, they are bullish on HIMS's ability to dominate personalized telehealth, these instruments deliver a way to participate at effectively 0% interest, capturing equity upside with a measurable safety net. As the company executes, the path toward conversion could reward both management and these noteholders handsomely. Not Financial Advice! DYOR! Video Source: youtube.com/watch?v=2LRztt…