HIMS: A Promising Setup, but Buyers Have One Big ProblemHims & Hers Health, Inc. Class ABATS:HIMSCedric_InvestsThe market has been taking a beating lately, and some of the most popular growth stocks have been getting absolutely destroyed. But not every corner of the market is suffering equally. Healthcare has recently attracted renewed attention as investors look for opportunities outside the crowded AI trade. And while that doesn't automatically make every healthcare stock a safe place to hide, it has me looking more closely at a few interesting setups. One of my favorites to watch right now is Hims & Hers (HIMS). The company has an interesting growth story behind it, and the chart is approaching a point where I think things could get exciting. There's just one problem. Buyers can't seem to get past $31. THE $31 PROBLEM Looking at the chart, HIMS has been giving us quite a ride. After reclaiming the important $25 support level, the stock pushed higher but ran into resistance around $31. Buyers managed another bounce from $25, eventually reclaiming $41, but that strength didn't last. The stock lost $41 again, and the selling that followed took us all the way back toward $25. What caught my attention was the recovery. Despite the selling pressure, HIMS managed to close back around $27, and that area has continued to play an important role in the current structure. But there's something I don't particularly like about what has happened since. Every attempt to establish momentum above $31 has failed. And until that changes, I have a hard time getting too excited about the bullish case. Here's how I'm approaching the setup: Above $31: A convincing reclaim would be a major improvement. If buyers can turn that level into support, I'd be watching for a potential recovery toward $40. Below $27: Losing this area would put $25 back in play. That's where I'd be particularly interested in watching for another reaction from buyers. Between $27 and $31: We're still stuck in a range, and neither side has done enough to convince me that the next meaningful move has started. Personally, I like the upside potential here, but I want to see buyers prove themselves first. STRONG GROWTH, BUT AT WHAT COST? The technical setup is only part of the picture. Hims & Hers continues to grow rapidly, and the company's second-quarter 2026 results made that very clear. The positives: - Revenue reached $753.2 million, growing 38% year over year. - Subscribers increased 19% to approximately 2.89 million. - Full-year revenue guidance was raised to $3.1–$3.3 billion. Those are impressive growth figures, especially for a company operating at this scale. But there's another side to the story. The concerns: - Gross margin dropped from 76% to 64%. - Adjusted EBITDA declined from $82.2 million to $60.3 million. - Net income swung from a $42.5 million profit to an $86.3 million loss. And that's what makes HIMS interesting to me. The demand for its services is clearly growing, but the business still needs to demonstrate that its expansion can translate into stronger profitability. Growth alone isn't enough to keep investors happy forever, particularly in a market where they're becoming less forgiving of companies with weakening margins. There is also an important date approaching. HIMS is scheduled to report its third-quarter earnings on November 9, which could give investors a much clearer picture of where profitability is heading. WHAT I'M WATCHING NEXT For now, I'm approaching HIMS with cautious optimism. The potential for a recovery toward $40 is there, and with $31 having rejected buyers repeatedly, I think a convincing breakout above that level would be particularly interesting. But I'm not going to ignore the downside simply because I like the setup. If $27 gives way, I'm looking straight back toward $25. And if buyers can't defend that area either, the technical picture becomes considerably less attractive. My preference is to see HIMS reclaim $31 and finally start rebuilding a stronger bullish structure. Until that happens, I'm keeping a close eye on how price behaves around $27.