Humana (HUM) AI Stock Analysis

• Market Cap: $33.90B
• Dividend Yield: 1.21%
• Average Volume (3M): 1.83M
• Price to Earnings (P/E): 21.6
• Beta (1Y): 0.41
• Revenue Growth: 9.88%
• EPS Growth: -7.25%
• Country: US
• Employees: 65,680
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Healthcare Plans
• EPS (TTM): 3.24
• Shares Outstanding: 120,271,820
• 10 Day Avg. Volume: 1,288,744
• 30 Day Avg. Volume: 1,833,596
• 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: 1.24
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 0.34
• Enterprise Value/Ebitda: 11.16
• 1Y Price Target: $303.92
• Price Target Upside: 7.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 70 Outperform
• Price Target: $310.00 ▲(9.98% Upside)

Humana's overall stock score reflects strong financial performance and positive earnings call insights, offset by mixed technical indicators and a moderate valuation. The company's strategic initiatives and operational efficiency improvements are significant strengths, while challenges in profitability and market uncertainties present risks.

Positive Factors

Revenue Growth

Humana's revenue growth exceeding expectations indicates strong market demand and effective business strategies, supporting long-term financial stability.

Operational Efficiency

Investments in AI and outsourcing finance capabilities enhance operational efficiency, reducing costs and improving margins over the long term.

Strategic Partnerships

Partnerships like the one with HOPCo enhance service offerings and patient outcomes, strengthening Humana's competitive position in the healthcare market.

Negative Factors

Declining ROE

A declining return on equity suggests challenges in efficiently using shareholder capital, potentially impacting long-term shareholder value.

Medicare Bonus Cuts

The loss of Medicare bonus payments could reduce revenue and profitability, posing a long-term challenge to financial performance.

Low Net Profit Margin

A low net profit margin indicates limited profitability, which may hinder the company's ability to reinvest in growth and innovation.

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 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: 281.87
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 281.87 is below the 20-day moving average (MA) of 283.01, above the 50-day MA of 280.11, and above the 200-day MA of 261.30, indicating a neutral trend. The MACD of 2.67 indicates Positive momentum. The RSI at 50.48 is Neutral, neither overbought nor oversold. The STOCH value of 23.26 is Neutral, 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	76 Outperform	$302.36B	17.42	18.48%	2.61%	10.48%	24.25%
HUM	70 Outperform	$33.90B	21.63	9.03%	1.21%	9.88%	-7.25%
CI	69 Neutral	$70.70B	11.68	14.65%	1.93%	16.75%	113.48%
ELV	68 Neutral	$70.37B	12.95	12.61%	1.93%	11.96%	-11.11%
CNC	61 Neutral	$17.75B	―	-21.93%	―	14.92%	-286.72%
MOH	61 Neutral	$7.80B	9.40	19.71%	―	13.71%	-18.02%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Humana Corporate Events

Humana Updates Q3 2025 Financial Results and Guidance

Humana Inc. reported its financial results for the third quarter of 2025, with an EPS of $1.62 on a GAAP basis and $3.24 on an adjusted basis. The company updated its full-year 2025 GAAP EPS guidance to approximately $12.26, while affirming its adjusted EPS guidance of approximately $17.00. Humana also revised its Medicare Advantage membership decline forecast to a smaller decrease of approximately 425,000 members, citing stronger retention and sales. The company is advancing its long-term strategy with growth in CenterWell and Medicaid businesses, and is preparing for new program launches in early 2026.

The most recent analyst rating on (HUM) stock is a Buy with a $326.00 price target. To see the full list of analyst forecasts on Humana stock, see the HUM Stock Forecast page.

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.