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Humana
(NYSE:HUM)
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Rating:63Neutral
Price Target:
$418.00
▲(103.76% Upside)
Action:Downgraded
Date:06/02/26
The score is driven primarily by mixed fundamentals: consistent growth but sharply compressed margins, lower returns, and uneven cash conversion. Technicals are supportive with strong trend momentum, but overbought readings add near-term risk. Valuation is a headwind given the higher P/E and modest yield, while the earnings call was constructive on long-term margin recovery but clear about persistent medical cost and reserving pressures.
Positive Factors
Revenue Growth
Humana's persistent top-line growth—driven by Medicare Advantage membership gains and Medicaid expansion—creates durable scale to negotiate provider rates, invest in care platforms and absorb investment in CenterWell. Steady revenue underpins multi-period recovery plans and strategic flexibility.
Negative Factors
Margin Compression
Sharp, sustained margin compression reduces Humana's earnings resilience and ROE, leaving limited buffer for cost shocks. Restoring durable margins will require multi-year pricing discipline, benefit changes, or operational gains—each carrying execution and retention risk across several plan years.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue Growth
Humana's persistent top-line growth—driven by Medicare Advantage membership gains and Medicaid expansion—creates durable scale to negotiate provider rates, invest in care platforms and absorb investment in CenterWell. Steady revenue underpins multi-period recovery plans and strategic flexibility.
Read all positive factors
Humana Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down sales figures for each business unit, indicating which areas are contributing most to growth and where there might be potential for expansion or risk.
Breaks down sales figures for each business unit, indicating which areas are contributing most to growth and where there might be potential for expansion or risk.
Data provided by:
The Fly
The FlyHumana (HUM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$47.09B
Dividend Yield1.38%
Average Volume (3M)1.39M
Price to Earnings (P/E)41.8
Beta (1Y)0.83
Revenue Growth14.08%
EPS Growth-33.82%
CountryUS
Employees65,680
SectorHealthcare
Sector Strength45
IndustryMedical - Healthcare Plans
Share Statistics
EPS (TTM)9.38
Shares Outstanding120,061,500
10 Day Avg. Volume1,220,193
30 Day Avg. Volume1,389,788
Financial Highlights & Ratios
PEG Ratio-18.55
Price to Book (P/B)1.75
Price to Sales (P/S)0.24
P/FCF Ratio82.27
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue0.38
Enterprise Value/Gross Profit2.73
Enterprise Value/Ebitda18.41
Forecast
1Y Price Target
$322.32Price Target Upside57.12% Upside
Rating ConsensusHold
Number of Analyst Covering20
EPS Forecast (FY)8.86
Revenue Forecast (FY)$162.12B
Humana Business Overview & Revenue Model
Company Description
Humana Inc., a prominent health and well-being enterprise, operates across the United States through its various subsidiary companies. Its operational structure is divided into three main segments: Retail, Group and Specialty, and Healthcare Servi...
How the Company Makes Money
Humana makes money primarily by operating health insurance plans and related healthcare services.
1) Health insurance premiums and government reimbursements (core revenue engine)
- Medicare Advantage (MA): Humana contracts with the U.S. federal g...
Humana Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Positive
The call conveyed constructive progress on strategic priorities — membership growth, CenterWell expansion, balance sheet improvements, operational transformation, and measured Stars progress — while candidly acknowledging persistent headwinds: medical cost trend outpacing funding, elevated early-year reserves, potential put-option cash exposure, and the need to consider benefit adjustments in 2027. Management emphasized prudence in reserving, disciplined bidding, and multiple levers (operational improvements, M&A, pricing) to meet the 2028 margin objective.Positive Updates
On-Track to Investor Day Commitments
Management reiterated they are on track to meet Investor Day commitments, targeting a sustainable Medicare Advantage margin of at least 3% in 2028 and making progress in 2027.
Negative Updates
Medical Cost Trend Outpacing Program Funding
Management acknowledged medical cost trend continues to outpace program funding despite CMS's improved rate notice, requiring pricing discipline and potential benefit adjustments to protect margins.
Read all updates
Q1-2026 Updates
Positive
Negative
On-Track to Investor Day Commitments
Management reiterated they are on track to meet Investor Day commitments, targeting a sustainable Medicare Advantage margin of at least 3% in 2028 and making progress in 2027.
Read all positive updates
Company Guidance
Humana reiterated that it is “where we expect to be” and is focused on returning to a sustainable individual MA margin of at least 3% by 2028 (with progress in 2027), expects to double individual MA margin in 2026 (adjusted for Stars), and will remain disciplined in pricing and benefit design; operational and capital moves cited include Medicaid growth of ~50,000 lives, CenterWell primary care adding ~110,000 patients (22.5% sequential growth) and the Max Health acquisition, early HEDIS closure ~5% ahead year-over-year on a per‑member basis, IBNR up ~35% sequentially vs ~22% Medicare membership growth, a Q2 MLR guide slightly above ~91%, completion of $1.0B junior subordinated notes in March to fund 2027 maturities, mitigation of >$3.0B in 2026 capital contribution requirements, and a potential Welsh Carson put exposure of roughly $1.0–$1.5B (planned for in the funding plan), while maintaining dividends, limiting buybacks to offset dilution and expecting CenterWell seasonality/operating metrics to normalize through the year.Humana Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
68
Positive
Cash Flow
56
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 137.20B | 129.66B | 117.81B | 106.44B | 92.92B | 83.65B |
| Gross Profit | 19.22B | 18.85B | 17.15B | 18.05B | 17.23B | 14.45B |
| EBITDA | 2.85B | 2.91B | 3.25B | 4.73B | 4.81B | 4.46B |
| Net Income | 1.13B | 1.19B | 1.21B | 2.49B | 2.81B | 2.93B |
Balance Sheet | ||||||
| Total Assets | 55.28B | 48.75B | 46.31B | 46.89B | 43.73B | 44.75B |
| Cash, Cash Equivalents and Short-Term Investments | 21.96B | 4.20B | 2.22B | 4.69B | 5.06B | 3.39B |
| Total Debt | 13.99B | 12.94B | 12.26B | 12.27B | 11.75B | 13.22B |
| Total Liabilities | 36.63B | 31.01B | 29.87B | 30.57B | 28.36B | 28.64B |
| Stockholders Equity | 18.58B | 17.66B | 16.38B | 16.26B | 15.31B | 16.08B |
Cash Flow | ||||||
| Free Cash Flow | 1.27B | 375.00M | 2.39B | 2.98B | 3.45B | 920.00M |
| Operating Cash Flow | 1.84B | 921.00M | 2.97B | 3.98B | 4.59B | 2.26B |
| Investing Cash Flow | -594.00M | 2.27B | -2.95B | -3.49B | -1.01B | -6.56B |
| Financing Cash Flow | -549.00M | -1.22B | -2.49B | -856.00M | -1.91B | 3.02B |
Humana Technical Analysis
Positive
205.14
Price Trends
331.05
Positive
258.29
Positive
254.66
Positive
Market Momentum
19.38
Positive
66.14
Neutral
55.13
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 205.14 is below the 20-day moving average (MA) of 380.95, below the 50-day MA of 331.05, and below the 200-day MA of 254.66, indicating a bullish trend. The MACD of 19.38 indicates Positive momentum. The RSI at 66.14 is Neutral, neither overbought nor oversold. The STOCH value of 55.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HUM.
Humana Risk Analysis
Humana disclosed 32 risk factors in its most recent earnings report. Humana reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Humana Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $77.63B | 12.37 | 15.16% | 2.21% | 9.30% | 30.22% | |
75 Outperform | $90.39B | 17.70 | 11.95% | 1.99% | 9.44% | -8.53% | |
74 Outperform | $385.62B | 32.02 | 12.40% | 2.69% | 9.67% | -44.84% | |
63 Neutral | $47.09B | 41.81 | 6.19% | 1.38% | 14.08% | -33.82% | |
57 Neutral | $33.26B | -5.13 | -28.72% | ― | 17.02% | -294.77% | |
57 Neutral | $12.16B | 68.82 | 4.44% | ― | 7.72% | -83.64% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% |
* Healthcare Sector Average
HUM
Humana
392.22
168.00
74.92%
CNC
Centene
67.35
36.71
119.81%
CI
Cigna
293.46
-3.03
-1.02%
MOH
Molina Healthcare
233.31
14.36
6.56%
UNH
UnitedHealth
424.62
131.88
45.05%
ELV
Elevance Health
416.23
83.16
24.97%
Humana Corporate Events
Business Operations and StrategyFinancial Disclosures
Humana Reaffirms 2026 Earnings Guidance in Investor Meetings
Positive
Jun 1, 2026
Humana Inc. said its senior management will meet investors and analysts between June 1 and June 30, 2026, and plans to reaffirm full-year 2026 guidance of at least $8.36 in diluted EPS and at least $9.00 in adjusted EPS. The company continues to e...
Business Operations and StrategyPrivate Placements and Financing
Humana Establishes Pre-Capitalized Trusts for Contingent Funding
Positive
May 19, 2026
On May 15, 2026, Humana arranged two pre-capitalized trust structures, Horseshoe Funding Trust I and II, each issuing $750 million of Pre-Capitalized Trust Securities to qualified institutional buyers in a Rule 144A transaction. The trusts investe...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Humana Posts Strong Q1 Results, Affirms 2026 Outlook
Positive
Apr 29, 2026
Humana on April 29, 2026 reported first-quarter 2026 GAAP EPS of $9.83 and adjusted EPS of $10.31, landing at the high end of its guidance range as its Insurance segment posted a slightly better-than-expected benefit ratio of 89.4 percent. The com...
Executive/Board ChangesShareholder Meetings
Humana Shareholders Approve Directors, Auditor and Incentive Plan
Positive
Apr 20, 2026
At Humana Inc.’s regular annual meeting of stockholders held on April 16, 2026, shareholders elected all ten nominees to the board of directors, each to serve until the next annual meeting or until a successor is chosen. The voting showed br...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.