Humana (HUM) AI Stock Analysis

• Market Cap: $35.46B
• Dividend Yield: 1.21%
• Average Volume (3M): 1.98M
• Price to Earnings (P/E): 22.6
• Beta (1Y): 0.42
• Revenue Growth: 9.88%
• EPS Growth: -7.25%
• Country: US
• Employees: 65,680
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Plans
• EPS (TTM): 6.27
• Shares Outstanding: 120,271,820
• 10 Day Avg. Volume: 1,513,119
• 30 Day Avg. Volume: 1,982,277
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.19
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 0.34
• Enterprise Value/Ebitda: 11.16
• 1Y Price Target: $296.51
• Price Target Upside: 0.58% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 22

• Rating: 71 Outperform
• Price Target: $314.00 ▲(6.51% Upside)

Humana's overall stock score is driven by strong financial performance and a positive earnings call, highlighting strategic growth in Medicaid and improved EPS guidance. Technical analysis and valuation are neutral, with no significant signals of overvaluation or undervaluation. Ongoing litigation and home health rate challenges are risks to monitor.

Positive Factors

Medicaid Expansion

Expanding Medicaid presence strengthens Humana's market position and diversifies revenue streams, supporting long-term growth.

CenterWell Pharmacy Performance

Strong performance in CenterWell Pharmacy indicates effective cost management and operational efficiency, enhancing profitability.

Strategic Partnerships

Partnerships like with Epic improve healthcare transparency and efficiency, bolstering Humana's competitive advantage and member satisfaction.

Negative Factors

Declining ROE

Declining ROE suggests challenges in maximizing shareholder returns, potentially impacting investor confidence and future capital raising.

Ongoing Litigation

Ongoing litigation introduces uncertainty and potential financial liabilities, which could affect Humana's operational focus and financial health.

Proposed Home Health Rate Reduction

Rate reductions in home health reimbursement could pressure margins and profitability, challenging Humana's cost management strategies.

Humana Business Overview & Revenue Model

Company Description

Humana Inc. is a health and well-being company based in the United States, primarily operating in the healthcare sector. The company offers a range of health insurance products, including Medicare Advantage plans, Medicare prescription drug plans, and commercial health insurance. Humana also provides wellness services, dental and vision plans, and various supplemental insurance products. With a focus on improving healthcare outcomes and enhancing member experiences, Humana serves millions of members across its various health plans.

How the Company Makes Money

Humana generates revenue primarily through premium payments received from its members for health insurance coverage. The company's key revenue streams include Medicare Advantage plans, which are funded by the federal government and provide comprehensive health services to eligible seniors. Additionally, Humana earns revenue from its Individual and Family plans, employer-sponsored group health plans, and Medicare prescription drug plans. The company also benefits from partnerships with healthcare providers and organizations, which help improve care management and reduce costs. These partnerships, along with its focus on value-based care, contribute to Humana's ability to optimize health outcomes and enhance its financial performance.

Humana Financial Statement Overview

Summary

Humana demonstrates strong revenue growth and effective cost management, evidenced by a high gross profit margin. The balance sheet is stable with moderate leverage, but declining ROE suggests challenges in maximizing shareholder returns. Cash flow generation is robust, though the recent decrease in operating cash flow warrants attention.

Income Statement

Humana's income statement shows a consistent revenue growth trend, with a TTM revenue growth rate of 2.37%. The company maintains a strong gross profit margin of 100%, indicating effective cost management. However, the net profit margin is relatively low at 1.28%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are stable, reflecting operational efficiency.

Balance Sheet

The balance sheet reveals a moderate debt-to-equity ratio of 0.69, indicating a balanced approach to leveraging. The return on equity (ROE) is 9.02%, which is decent but shows a decline from previous years. The equity ratio stands at 36.21%, suggesting a solid equity base relative to total assets.

Cash Flow

Cash flow analysis indicates a positive free cash flow growth rate of 2.44% in the TTM period. The operating cash flow to net income ratio is 0.17, and the free cash flow to net income ratio is 0.83, highlighting strong cash generation relative to net income. However, the operating cash flow has decreased compared to previous periods, which could be a concern.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	123.11B	117.76B	106.37B	92.87B	83.06B	77.16B
Gross Profit	123.11B	117.76B	106.37B	92.87B	83.06B	77.16B
EBITDA	3.78B	3.35B	4.79B	4.81B	4.39B	5.50B
Net Income	1.58B	1.21B	2.49B	2.81B	2.93B	3.37B
Balance Sheet
Total Assets	50.36B	46.48B	47.06B	43.05B	44.36B	34.97B
Cash, Cash Equivalents and Short-Term Investments	21.71B	20.43B	21.32B	5.06B	3.39B	4.67B
Total Debt	12.59B	11.72B	11.66B	11.13B	12.49B	6.66B
Total Liabilities	32.06B	30.03B	30.75B	27.68B	28.25B	21.24B
Stockholders Equity	18.23B	16.38B	16.26B	15.31B	16.08B	13.73B
Cash Flow
Free Cash Flow	2.44B	2.39B	2.98B	3.47B	946.00M	4.67B
Operating Cash Flow	2.93B	2.97B	3.98B	4.59B	2.26B	5.64B
Investing Cash Flow	-875.00M	-2.95B	-3.49B	-1.01B	-6.56B	-3.06B
Financing Cash Flow	-3.52B	-2.49B	-856.00M	-1.91B	3.02B	-1.96B

Humana Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 294.80
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HUM, the sentiment is Positive. The current price of 294.8 is above the 20-day moving average (MA) of 280.97, above the 50-day MA of 281.03, and above the 200-day MA of 261.18, indicating a bullish trend. The MACD of 5.16 indicates Negative momentum. The RSI at 59.51 is Neutral, neither overbought nor oversold. The STOCH value of 88.91 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HUM.

Humana Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UNH	―	$328.31B	15.70	―	2.36%	9.98%	52.31%
CI	―	$80.55B	16.48	12.31%	1.93%	20.93%	43.98%
HUM	―	$35.46B	22.63	9.03%	1.21%	9.88%	-7.25%
CNC	―	$16.30B	8.21	7.50%	―	12.96%	-23.25%
ELV	―	$76.08B	14.00	12.61%	1.93%	11.96%	-11.11%
MOH	―	$8.37B	10.09	19.71%	―	13.71%	-18.02%
Sector *	―	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Humana Corporate Events

Humana Projects Strong 2025 Earnings Amidst Star Ratings Challenge

Humana Inc. announced its preliminary 2026 Medicare Advantage Star Ratings, revealing that approximately 20% of its members are enrolled in plans rated 4 stars and above, with an average Star rating of 3.61. The company is executing a contract diversification strategy to improve future ratings and expects a higher percentage of members in top-rated plans by 2027. Despite not being satisfied with the 2026 ratings, Humana is confident in its operational improvements and strategic initiatives, anticipating a return to Top Quartile results for the 2027 Star Ratings. Additionally, Humana affirmed its 2025 earnings guidance, projecting approximately $13.77 in GAAP EPS and $17.00 in adjusted EPS, reflecting confidence in its core business operations and strategic planning.

The most recent analyst rating on (HUM) stock is a Hold with a $290.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

Humana Reaffirms 2025 Earnings Guidance in September Meeting

In September 2025, Humana Inc.’s senior management will meet with investors and analysts to reaffirm its earnings guidance for the fiscal year ending December 31, 2025. The company projects approximately $13.77 in diluted earnings per share and $17.00 in adjusted earnings per share, consistent with previous guidance. Humana emphasizes the use of adjusted EPS as a comprehensive measure for evaluating its core operating performance, aiding in planning and decision-making.

The most recent analyst rating on (HUM) stock is a Buy with a $325.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

Humana Inc. Reports Strong Q2 2025 Earnings and Raises Guidance

Humana Inc. is a leading health insurance company based in Louisville, Kentucky, primarily serving Medicare and Medicaid beneficiaries, and offering a range of healthcare services through its CenterWell segment. In its latest earnings report, Humana announced a second-quarter GAAP earnings per share (EPS) of $4.51 and an adjusted EPS of $6.27, with year-to-date adjusted EPS reaching $17.85. The company reported a revenue increase to $32.4 billion for the quarter, up from $29.5 billion the previous year, and raised its full-year 2025 revenue guidance to at least $128 billion.

Humana’s Earnings Call: Positive Outlook Amid Challenges

During Humana’s latest earnings call, the company expressed a generally positive sentiment, highlighting increased earnings guidance and strong performance in key areas. The leadership conveyed optimism, particularly due to the outperformance of CenterWell Pharmacy and improved membership retention. However, they also acknowledged ongoing challenges, such as litigation related to Stars and the need for operational transformations to manage costs effectively.

Humana Lowers 2025 GAAP EPS Guidance

Humana Inc. reported its financial results for the second quarter of 2025, highlighting a GAAP earnings per share (EPS) of $4.51 and an adjusted EPS of $6.27. The company has revised its full-year 2025 guidance, lowering GAAP EPS expectations to approximately $13.77 while raising adjusted EPS guidance to approximately $17.00. Humana also increased its revenue guidance to at least $128 billion and adjusted its Medicare Advantage membership projections to a decline of up to 500,000 members, reflecting strategic exits from unprofitable plans. The company continues to expand its CenterWell operations and launched a new Medicaid contract in Virginia, indicating a focus on sustainable growth and value creation.

The most recent analyst rating on (HUM) stock is a Buy with a $316.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.