Momo Stocks Sell Off As Trump Hopium Meets Reality, All Eyes On Nvidia, China Caught Cutting Cable

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Hopium Meeting Reality

Please click here for an enlarged chart of Hims & Hers Health Inc (HIMS).

Note the following:

• In many areas, hopium from President Trump is justified.  However, the momo crowd has taken it to an extreme.  As an example, to the best of our knowledge, President Trump has not made a vigorous public statement saying that he would allow copycat versions of weight loss drugs by changing the current law.  Yet, the momo crowd, with its absolute faith in President Trump, continued to buy HIMS stock believing President Trump would be their savior.
• This article is about the big picture, not an individual stock.  The chart of HIMS is being used to illustrate the point.  HIMS is a telehealth company that has grown rapidly by selling copycat weight loss drugs.  The law allows compounded versions when there is a shortage.
• The chart shows the momo crowd was aggressively running up HIMS stock when the FDA posted on its website that the Wegovy and Ozempic shortage had ended.  Wegovy and Ozempic are weight loss drugs from Novo Nordisk A/S (NVO).  Semaglutide is the active ingredient of these drugs.  HIMS has been selling a copycat version of semaglutide.
• It was well known that the Wegovy and Ozempic shortage was going to end in February.  Yet, the momo crowd continued to buy HIMS stock on the belief that President Trump would bar the FDA from enforcing the law.
• Previously, a shortage of Eli Lilly And Co (LLY) weight loss drug Zepbound with active ingredient tirzepatide had ended.  HIMS was involved in compounding tirzepatide.  At that time, HIMS stock was trading much lower than where it has been trading recently.  HIMS stock initially dropped, and the momo crowd aggressively bought the dip.  HIMS mainstay was semaglutide, and not tirzepatide.  The momo crowd continued to run up HIMS stock on hopium that by the time the Wegovy and Ozempic shortage ended, President Trump would be in office and would save them.
• The chart shows the drop in HIMS stock even though the FDA said it was not taking any action against compounders for violations.
• The chart shows another big drop on earnings after the market closed yesterday, even though earnings were good.  The reason the stock dropped is HIMS said it would …

Full story available on Benzinga.com