Humana (HUM) AI Stock Analysis

• Market Cap: $22.98B
• Dividend Yield: 1.38%
• Average Volume (3M): 2.59M
• Price to Earnings (P/E): 19.4
• Beta (1Y): 0.70
• Revenue Growth: 9.87%
• EPS Growth: -5.58%
• Country: US
• Employees: 65,680
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Plans
• EPS (TTM): -3.96
• Shares Outstanding: 120,595,970
• 10 Day Avg. Volume: 1,650,279
• 30 Day Avg. Volume: 2,589,264
• PEG Ratio: -18.57
• Price to Book (P/B): 1.75
• Price to Sales (P/S): 0.24
• P/FCF Ratio: 82.27
• Enterprise Value/Market Cap: 1.35
• Enterprise Value/Revenue: 0.24
• Enterprise Value/Gross Profit: 1.65
• Enterprise Value/Ebitda: 10.69
• 1Y Price Target: $215.00
• Price Target Upside: 12.84% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 20
• EPS Forecast (FY): 9.59
• Revenue Forecast (FY): $158.21B

• Rating: 46 Neutral
• Price Target: $180.00 ▼(-5.53% Downside)
• Action: Reiterated Date: 02/17/26
• Date: Action: Reiterated 02/17/26

The score is weighed down primarily by weakening profitability and a sharp deterioration in 2025 operating/free cash flow, reinforced by conservative 2026 guidance driven by the ~$3.5B STARS headwind and margin pressure. Technicals also remain strongly negative with the stock well below key moving averages. Valuation and the dividend offer some support but are not sufficient to offset near-term fundamentals and outlook risks.

Positive Factors

Durable Revenue Growth

Humana’s top line showed multi-year growth through 2025, driven by Medicare Advantage, Medicaid and pharmacy streams. Sustained premium inflows and scale in government programs create structural revenue durability and support long-term capacity to invest in care models and productivity gains.

Membership Growth & Retention

Large, repeatable MA membership gains and materially improved retention raise lifetime value and enable operating leverage. A higher share of switchers and sales from higher‑LTV channels structurally improves customer mix and supports margin recovery as onboarding and care programs mature.

Moderate Leverage & Capital Actions

Balance sheet metrics show moderate industry‑typical leverage and active capital management that offset capital requirements. This financial flexibility supports strategic investments, targeted M&A and operational transformation without forcing abrupt deleveraging that could impair care expansion.

Negative Factors

Weakened Cash Generation

A sharp decline in operating and free cash flow reduces Humana’s internal funding for transformation, provider support and working capital. Persistently lower cash conversion constrains ability to absorb rating/funding shocks, sustain capital returns, or accelerate investments without external financing.

Margin Compression & STARS Headwind

Material margin deterioration and a multi‑billion STARS funding headwind compress underwriting economics. Even with membership growth, star‑driven bonus variability and lower effective funding limit Humana’s ability to convert volume into sustained profits without multi‑year improvement in quality metrics or funding resets.

Advance Rate & Guidance Uncertainty

Uncertainty in MA advance rates and deliberately conservative guidance highlight funding and execution risk. Potential for benefit/pricing adjustments and delayed margin recovery raises the likelihood that operational improvements will take multiple years to fully offset regulatory and funding volatility.

Humana Business Overview & Revenue Model

Company Description

Humana Inc., together with its subsidiaries, operates as a health and well-being company in the United States. It operates through three segments: Retail, Group and Specialty, and Healthcare Services. The company offers medical and supplemental benefit plans to individuals. It also has a contract with Centers for Medicare and Medicaid Services to administer the Limited Income Newly Eligible Transition prescription drug plan program; and contracts with various states to provide Medicaid, dual eligible, and long-term support services benefits. In addition, the company provides commercial fully insured medical and specialty health insurance benefits comprising dental, vision, and other supplemental health benefits; and administrative services only products to individuals and employer groups, as well as military services, such as TRICARE T2017 East Region contract. Further, it offers pharmacy solutions, provider services, and home solutions services, such as home health and other services to its health plan members, as well as to third parties. As of December 31, 2021, the company had approximately 17 million members in medical benefit plans, as well as approximately 5 million members in specialty products. Humana Inc. was founded in 1961 and is headquartered in Louisville, Kentucky.

How the Company Makes Money

Humana generates revenue primarily through its health insurance premiums, which are collected from members enrolled in its various health plans, including Medicare Advantage, Medicare Prescription Drug Plans, and employer-sponsored commercial plans. The company's revenue model is based on risk adjustment payments from the Centers for Medicare & Medicaid Services (CMS) for its Medicare Advantage plans, which compensates Humana for providing services to members with varying health risk profiles. Additional revenue streams include fees for administering Medicaid plans and revenues from its pharmacy services division, where it manages pharmacy benefits for members. Significant partnerships with healthcare providers and the integration of technology to enhance patient care and streamline operations also contribute to Humana's earnings by improving efficiency and member satisfaction.

Humana Financial Statement Overview

Summary

Revenue growth has been durable, and leverage appears moderate for the industry, but recent profitability and cash generation have weakened meaningfully. Net margin compression and a sharp drop in operating/free cash flow in 2025 are the key negatives and reduce earnings quality.

Income Statement

Revenue has grown steadily from 2020 to 2025 (annual growth mostly high-single to mid-teens before slowing in 2025), showing durable top-line momentum. However, profitability has weakened meaningfully: net margin fell from ~4.4% (2020) to ~0.9% (2025), and operating profit levels are far below prior years (EBIT down sharply versus 2022–2023). Overall, the business is still profitable, but the earnings trajectory and margin compression are the key negatives.

Balance Sheet

Leverage is moderate: total debt of ~$12.4B against ~$17.7B equity in 2025, and the 2024 debt-to-equity level (~0.68) is reasonable for the industry. Assets and equity have grown over time, supporting balance-sheet stability. The main weakness is reduced profitability translating into weaker returns on shareholder capital (return on equity was solid in 2021–2024, but is not provided for 2025 and earnings have clearly compressed).

Cash Flow

Cash generation weakened materially in the most recent year: operating cash flow fell to ~$0.9B in 2025 from ~$3.0B in 2024, and free cash flow dropped to ~$0.4B (down ~76% year over year). Free cash flow also covered less than half of net income in 2025 (~41%), indicating weaker cash conversion versus prior years. While the company has produced strong cash flows historically, the sharp recent deterioration is a notable risk signal.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	129.66B	117.81B	106.44B	92.92B	83.65B
Gross Profit	18.85B	17.15B	18.05B	17.23B	14.45B
EBITDA	2.91B	3.25B	4.73B	4.81B	4.46B
Net Income	1.19B	1.21B	2.49B	2.81B	2.93B
Balance Sheet
Total Assets	48.91B	46.48B	47.06B	43.05B	44.36B
Cash, Cash Equivalents and Short-Term Investments	19.90B	2.22B	4.69B	5.06B	3.39B
Total Debt	12.37B	11.14B	10.21B	9.03B	10.54B
Total Liabilities	31.17B	30.03B	30.75B	27.68B	28.25B
Stockholders Equity	17.66B	16.38B	16.26B	15.31B	16.08B
Cash Flow
Free Cash Flow	375.00M	2.39B	2.98B	3.45B	920.00M
Operating Cash Flow	921.00M	2.97B	3.98B	4.59B	2.26B
Investing Cash Flow	2.27B	-2.95B	-3.49B	-1.01B	-6.56B
Financing Cash Flow	-1.22B	-2.49B	-856.00M	-1.91B	3.02B

Humana Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 190.54
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HUM, the sentiment is Negative. The current price of 190.54 is above the 20-day moving average (MA) of 186.29, below the 50-day MA of 230.59, and below the 200-day MA of 249.07, indicating a neutral trend. The MACD of -13.20 indicates Negative momentum. The RSI at 42.41 is Neutral, neither overbought nor oversold. The STOCH value of 63.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HUM.

Humana Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CI	73 Outperform	$76.38B	13.07	14.40%	2.21%	16.75%	113.48%
ELV	64 Neutral	$70.63B	12.69	13.29%	1.99%	11.96%	-11.11%
UNH	63 Neutral	$265.66B	22.16	―	2.69%	10.48%	24.25%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
CNC	51 Neutral	$22.07B	-3.29	-28.79%	―	14.92%	-286.72%
MOH	49 Neutral	$7.93B	18.01	11.02%	―	13.71%	-18.02%
HUM	46 Neutral	$22.98B	19.38	6.98%	1.38%	9.87%	-5.58%

Humana Corporate Events

Humana Issues 2026 Guidance Amid Medicare Advantage Headwinds

Humana reported that for the fourth quarter of 2025 it posted a GAAP net loss per share of $6.61 and an adjusted net loss per share of $3.96, while full-year 2025 GAAP EPS came in at $9.84 and adjusted EPS at $17.14, broadly in line with management expectations. The insurer’s 2025 Insurance segment GAAP benefit ratio was 90.4%, slightly better than its guided top-end range, and the company highlighted strong growth in its CenterWell Senior Primary Care business, adding more than 100,000 patients during 2025 including those from The Villages Health acquisition, as well as an expanded Medicaid footprint now spanning 13 states with Georgia and Texas expected to launch in 2027.

On February 11, 2026, Humana issued full-year 2026 guidance of at least $8.89 in GAAP EPS and at least $9.00 on an adjusted basis, signaling a year-over-year earnings decline driven by Star Ratings headwinds for the 2026 bonus year despite mitigation efforts. Management also projected approximately 25% growth in individual Medicare Advantage membership in 2026, driven by new sales and improved retention linked to its consumer-led benefit and service strategy, underscoring a continued strategic shift toward government programs and senior-focused care platforms that could reinforce the company’s long-term positioning despite near-term pressure on profitability.

The most recent analyst rating on (HUM) stock is a Hold with a $260.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

Humana Announces Leadership Changes Effective January 2026

On December 16, 2025, Humana announced the retirement of George Renaudin, Insurance Segment President, by Q3 2026 after a 29-year career. Aaron Martin will join as President of Medicare Advantage in January 2026 and succeed Renaudin as Insurance Segment President. John Barger will become President of Medicare Advantage. These leadership changes aim to strengthen Humana’s operations and continue its focus on value-based care and shareholder value creation.

The most recent analyst rating on (HUM) stock is a Hold with a $282.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

Humana Reaffirms Earnings Guidance for December 2025

Humana Inc. announced that its senior management will meet with investors and analysts throughout December 2025 to reaffirm its earnings guidance for the year. The company projects approximately $12.26 in diluted earnings per share and $17.00 in adjusted earnings per share for FY 2025. This guidance aligns with previous announcements and highlights the company’s focus on providing a comprehensive view of its core operating performance through both GAAP and non-GAAP measures. The reaffirmation of earnings guidance suggests stability in Humana’s financial outlook and operational strategies, potentially impacting stakeholder confidence and market positioning.

The most recent analyst rating on (HUM) stock is a Hold with a $234.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.