Humana (HUM) AI Stock Analysis

• Market Cap: $32.07B
• Dividend Yield: 1.33%
• Average Volume (3M): 1.74M
• Price to Earnings (P/E): 20.5
• Beta (1Y): 0.32
• Revenue Growth: 9.88%
• EPS Growth: -7.25%
• Country: US
• Employees: 65,680
• Sector: Healthcare
• Sector Strength: 38
• Industry: Medical - Healthcare Plans
• EPS (TTM): 6.27
• Shares Outstanding: 120,271,820
• 10 Day Avg. Volume: 2,220,772
• 30 Day Avg. Volume: 1,737,847
• PEG Ratio: -0.51
• Price to Book (P/B): 1.87
• Price to Sales (P/S): 0.26
• P/FCF Ratio: 12.79
• Enterprise Value/Market Cap: 1.31
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 0.34
• Enterprise Value/Ebitda: 10.97
• 1Y Price Target: $285.10
• Price Target Upside: 6.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 21

• Rating: 75 Outperform
• Price Target: $300.00 ▲(12.50% Upside)

Humana's overall stock score of 75 reflects strong financial performance and positive technical momentum. The increased EPS guidance and strategic initiatives from the earnings call are significant positives. However, valuation concerns and potential operational challenges temper the outlook.

Positive Factors

Financial Performance

HUM reported a strong quarter and bumped up their 2025 EPS guide despite adding an incremental $100m of investments this year.

Revenue Growth

Centerwell segment revenue of $5.5 billion beat consensus estimates of $5.2 billion and estimate of $5.3 billion.

Negative Factors

Legal Challenges

Humana lost its Star ratings lawsuit, which could impact financial outcomes.

Regulatory Risks

There is a recurring risk of losing on Stars/QBP in future years, even if Humana won the case.

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's financial performance is robust, with strong revenue growth and profitability. The income statement shows a consistent increase in revenue and improved profit margins. The balance sheet is solid with controlled leverage, though there's a slight decline in ROE. Cash flow generation is efficient but shows mixed growth. Overall, the financial outlook is strong, with consistent growth prospects.

Income Statement

Humana's income statement reflects strong profitability with a consistent increase in total revenue from 2020 to TTM 2025. The Gross Profit Margin remains robust at 100% due to the accounting classification. The Net Profit Margin for TTM stands at 1.42% and shows improvement over prior years despite some fluctuations. Revenue growth has been steady, with a notable 28.6% increase from 2022 to 2023. EBIT and EBITDA margins show resilience, though slightly varied, indicating operational efficiency. Overall, the income statement reflects a positive trajectory in revenue growth and profitability.

Balance Sheet

The balance sheet shows a solid equity base with Stockholders' Equity consistently growing. The Debt-to-Equity Ratio for TTM stands at 0.75, indicating a manageable level of leverage. The Equity Ratio is at 34.84%, reflecting a stable equity position relative to total assets. Return on Equity (ROE) for TTM is 9.63%, which is reasonable, though it has decreased compared to previous years. Overall, the balance sheet reflects financial stability with controlled leverage and a solid equity base, though ROE has seen a slight decline.

Cash Flow

Cash flow analysis indicates strong operational cash flow with an Operating Cash Flow to Net Income Ratio of 1.68 for TTM, suggesting efficient cash generation from operations. Free Cash Flow remains stable, showing slight growth with the Free Cash Flow to Net Income Ratio at 1.39. However, Free Cash Flow growth has been inconsistent, as seen in modest changes from 2022 to TTM. Overall, cash flow statements reflect healthy operational cash generation and sufficient free cash flow, though growth has been mixed.

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	3.84B	3.53B	4.93B	4.64B	3.86B	5.60B
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	11.42B	12.82B	6.98B
Total Liabilities	32.06B	30.03B	30.75B	9.03B	10.54B	6.06B
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: 266.67
• 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 266.67 is above the 20-day moving average (MA) of 241.10, above the 50-day MA of 237.90, and above the 200-day MA of 258.44, indicating a bullish trend. The MACD of 7.35 indicates Negative momentum. The RSI at 66.02 is Neutral, neither overbought nor oversold. The STOCH value of 85.69 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
HUM	75 Outperform	$32.07B	20.47	9.03%	1.33%	9.88%	-7.25%
ELV	71 Outperform	$65.48B	12.38	12.48%	2.30%	10.21%	-17.79%
UNH	68 Neutral	$228.94B	10.93	24.33%	3.37%	9.98%	―
MOH	65 Neutral	$8.34B	7.59	23.93%	―	16.12%	10.99%
CI	63 Neutral	$73.95B	15.13	12.31%	2.10%	20.93%	43.98%
CNC	58 Neutral	$12.40B	6.24	7.50%	―	12.96%	-23.25%
Sector *	51 Neutral	$7.35B	-0.20	-44.86%	2.33%	28.96%	-1.05%

Humana Corporate Events

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.

Humana Reaffirms 2025 Earnings Guidance in June Meetings

Humana Inc. announced that its senior management will meet with investors and analysts throughout June 2025 to reaffirm its earnings guidance for the year ending December 31, 2025. The company projects diluted earnings per share of approximately $14.68 and adjusted earnings per share of approximately $16.25, consistent with its previous guidance. Humana will also host an Investor Conference on June 16, 2025, to discuss its strategic direction and financial performance. The use of Adjusted EPS, which differs from GAAP EPS, is intended to provide a more comprehensive view of the company’s core operating performance.

The most recent analyst rating on (HUM) stock is a Hold with a $253.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

Humana Secures $5 Billion Credit Agreement

On May 30, 2025, Humana Inc. entered into a $5.0 billion unsecured revolving credit agreement with several banks, increasing its previous credit commitment from $2.642 billion. This new agreement replaces an expired $2.1 billion credit agreement and includes provisions for interest rates, facility fees, and covenants, allowing for up to $1.0 billion in incremental commitments. As of the agreement date, Humana had no outstanding borrowings and maintained approximately $4.98 billion in borrowing capacity, which could significantly impact its financial flexibility and operational strategy.

The most recent analyst rating on (HUM) stock is a Hold with a $253.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.