A partnership between the two companies could create “an enhanced revenue runway” for Hims, said Leerink Partners analyst Michael Cherny. However, more details are needed, he said.

Shares of Hims rose as much as 5% in premarket trading in New York on Tuesday. The company also reported Monday that it posted $599 million in revenue in the quarter, above the average Wall Street estimate.

Hims and Novo had a partnership, but it ended in June after Novo accused Hims of using “deceptive marketing” to sell copycat versions of its blockbuster weight-loss shot Wegovy.

While Hims has long offered a suite of treatments for hair loss and erectile dysfunction, its business has become more dependent on selling weight-loss drugs.

Initially, Hims offered the drugs as an alternative to shots from Novo and Eli Lilly & Co. during shortages of their shots. Now that the shortage is over, regulators have been cracking down on copycat drugs, which has hurt Hims business.

Partnering with Novo could “remove some of the general market pressures and questions on Hims’ ability to sell weight loss drugs,” Cherny said.

Hims also lowered the top end of its sales guidance for the year. The San Francisco-based company now expects sales for the year of up to $2.36 billion, slightly below the $2.4 billion it previously forecast. The company did not give a reason for the change.

“Investor expectations had come down ahead of earnings, so softer fourth-quarter guidance was not a suprise,” said Craig Hettenbach, an analyst at Morgan Stanley. “However, there’s still plenty to debate on how long headwinds to core growth will persist, the timing and contribution of new product launches and implications of rising investment on margins near term.”

--With assistance from Subrat Patnaik and Lisa Pham.