Let's get one thing straight. Whenever a CEO sells millions of dollars of their own company’s stock and the press release mentions a “prearranged investment plan,” you should immediately translate that phrase in your head. It means: “Nothing to see here, folks. This was all planned. Totally normal. Please don’t notice that the captain is quietly lowering a golden lifeboat while telling you the voyage to riches is just beginning.”
On Friday, Hims & Hers stock took a 14% nosedive. Why? Because CEO Andrew Dudum decided it was a great day to lighten his pockets by about $11 million. The official story, according to Hims & Hers Stock Nosedives -- CEO Cashes Out $11 Million Stake, is that this was all done under a Rule 144 filing, a prearranged plan set up ages ago.
Give me a break.
A prearranged plan is the corporate equivalent of setting your coffee machine to brew at 7 AM. You might have set the timer a month ago, but you still know damn well that hot coffee is coming. You aren't surprised by it. It’s an automated process designed to remove the appearance of panicked, opportunistic selling. It’s a tool for plausible deniability. And we’re all supposed to nod along and pretend the timing is just a wacky coincidence? That the CEO has no idea what the company's internal forecasts look like or what challenges are coming down the pike when these sales just happen to execute?
This isn't just bad optics. No, 'bad' doesn't cover it—this is a five-alarm dumpster fire of investor confidence. It’s a signal, a giant flashing neon sign that reads, "I'm taking my winnings off the table." And if the guy running the casino is cashing out, why the hell should anyone else stay and play?
A Drip, Drip, Drip Becomes a Flood
If this were a one-time thing, maybe you could squint and see the logic. A founder needs to diversify, buy a new mansion in Atherton, fund a space venture, whatever. We’ve heard it all before. But this ain't a one-off event. It’s a pattern. A very expensive, very telling pattern.
Between mid-July and mid-September, Dudum or his trusts had already offloaded around $29.3 million in company shares. Add Friday’s $11 million, and you’re looking at over $40 million cashed out in just a few months. That’s not diversification; that’s a strategic exit. It’s the slow, methodical draining of a swimming pool before the summer ends.
And the timing is just… chef’s kiss. All this is happening while the company is pumping out press releases about its bold expansion into treatments for menopause and perimenopause. They’re painting this beautiful picture of a future where Hims & Hers is a holistic wellness brand for everyone. I can just imagine the PowerPoint slides, the slick graphics showing a hockey-stick growth chart. You can almost hear the low hum of the PR machine churning out feel-good stories about a company that cares.
But how much does the CEO care when he’s consistently, repeatedly, taking cash off the table? What does he know that the average person buying HIMS on their Robinhood app doesn't? They sell you the sizzle of a new product line while the founder is quietly selling the steak—his own steak. It’s the oldest trick in the book, and frankly, I’m tired of watching people fall for it. They tell you to 'buy the dip,' while they're selling the peak, and we're just supposed to sit here and...
It reminds me of my old landlord who would talk about all the "amazing upgrades" coming to the building right before he'd jack up the rent by 20%. The talk is always about the future, but the actions are all about the present-day cash grab. It's a classic misdirection. Offcourse, maybe I'm just too cynical. Then again, I'm not the one down 14% in a single day.
The Unspoken Truth of the C-Suite
So what’s the real story here? We don’t have access to the board meetings or Dudum’s private thoughts, but you don’t need a Wharton MBA to connect these dots. A founder-CEO is the ultimate insider. He knows the company’s strengths, sure, but more importantly, he knows every single skeleton in every single closet. He knows the growth projections that are realistic and the ones that are pure fantasy for the benefit of Wall Street analysts.
When that person sells, it speaks volumes. When they sell repeatedly, it's a scream.
The whole "prearranged plan" defense is an insult to our intelligence. It assumes we’re all too dumb to understand that these plans can be set up, modified, or canceled. They aren’t ironclad prophecies handed down from the heavens. They are strategic financial instruments used by the wealthy to cash out without triggering SEC investigations. It’s a loophole big enough to drive a Brinks truck through, and Dudum just drove one right through it.
Are we really supposed to believe that this $40 million exodus is just business as usual? That it has no bearing on the future prospects of a company whose stock just got hammered? The market certainly didn't buy the excuse. A 14% drop is a vote of no confidence, plain and simple. It’s the collective sound of thousands of investors simultaneously realizing the person they trusted most might not be as all-in as they thought.
Follow the Money, Not the Hype
Look, I'm not a financial advisor. I'm the guy who points out when the emperor isn't wearing any clothes. And right now, the leadership at Hims & Hers is looking pretty damn naked. The press releases can talk about menopause and a bright, expansive future all they want. But the SEC filings are telling a much simpler, much more honest story: the CEO is getting paid. In cash. Now. While you're left holding the bag. Actions always, always speak louder than words, and $40 million in stock sales is practically a primal scream.
