In a report released yesterday, Whit Mayo from Leerink Partners maintained a Hold rating on Humana (HUM – Research Report), with a price target of $282.00.
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Whit Mayo has given his Hold rating due to a combination of factors related to Humana’s recent performance and future outlook. The company’s fourth-quarter results for 2024 were largely in line with market expectations, with a slight increase in the Medical Loss Ratio, indicating some room for improvement in operational efficiency. While Humana has shown progress in its Stars investments, there remains uncertainty regarding the outcome of its appeal, suggesting potential challenges ahead.
Despite management’s efforts to outline initiatives focused on product experience, clinical excellence, and operational efficiency, the projected membership growth appears lower than anticipated, leading to a decrease in adjusted EPS estimates for 2025 and 2026. The company’s efforts to stabilize benefits and ensure consistent growth are noteworthy, but debates continue about the timing and pace of margin recovery. Consequently, the price target has been slightly adjusted, reflecting these tempered expectations.
In another report released yesterday, Morgan Stanley also reiterated a Hold rating on the stock with a $285.00 price target.
HUM’s price has also changed moderately for the past six months – from $348.290 to $260.030, which is a -25.34% drop .