Humana (HUM) AI Stock Analysis

• Market Cap: $28.39B
• Dividend Yield: 1.5%
• Average Volume (3M): 1.75M
• Price to Earnings (P/E): 16.6
• Beta (1Y): 0.20
• Revenue Growth: 10.09%
• EPS Growth: -12.18%
• Country: US
• Employees: 65,680
• Sector: Healthcare
• Sector Strength: 58
• Industry: Medical - Healthcare Plans
• EPS (TTM): 11.58
• Shares Outstanding: 120,693,474
• 10 Day Avg. Volume: 1,531,415
• 30 Day Avg. Volume: 1,750,668
• PEG Ratio: -8.91
• Price to Book (P/B): 4.23
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.68
• Enterprise Value/Market Cap: 1.80
• Enterprise Value/Revenue: 0.11
• Enterprise Value/Gross Profit: 0.42
• Enterprise Value/Ebitda: 3.27
• 1Y Price Target: $296.47
• Price Target Upside: 26.02% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 72 Outperform
• Price Target: $259.00 ▲(10.09%Upside)

Humana's strong financial performance and recent corporate events underpin a favorable outlook. While valuation remains fair and the company shows operational strength, technical analysis suggests caution due to lack of upward momentum. External uncertainties from regulatory challenges and litigation also temper the overall score.

Positive Factors

Earnings

Humana reported solid earnings with adjusted EPS significantly above consensus, driven partly by timing of certain expenses.

Financial Guidance

The company reaffirmed its full-year adjusted EPS guidance, indicating confidence in its financial outlook.

Operational Performance

EBITDA was 27.2% above the estimate, indicating strong operational performance.

Negative Factors

Cost Trends

There are risks such as the potential for MA cost trends to reaccelerate, which could limit margin expansion.

Legal Challenges

HUM faces a material headwind from star ratings changes assuming its legal challenge is unsuccessful.

Membership Decline

Total medical membership decreased 7.2% year over year.

Humana Business Overview & Revenue Model

Company Description

Humana Inc. (HUM) is a leading health and well-being company that operates primarily in the insurance sector, offering a wide range of health insurance products and services. The company specializes in providing Medicare Advantage plans, standalone prescription drug plans, and commercial health insurance. Humana also offers wellness solutions, including behavioral health services, pharmacy services, and home health care, aimed at improving the overall health outcomes of its members.

How the Company Makes Money

Humana makes money primarily through its health insurance offerings, with a significant portion of its revenue generated from Medicare Advantage plans. These plans are funded by the U.S. government and provide coverage for medical services to individuals over the age of 65. Humana receives a fixed payment per member from the government, which it supplements with premiums paid by members. Additionally, Humana earns revenue from its commercial insurance products, including employer-sponsored health plans. Another key revenue stream comes from its pharmacy solutions, which include prescription drug plans and mail-order pharmacy services. Strategic partnerships with healthcare providers and innovations in healthcare delivery also contribute to its earnings by enhancing service efficiency and member satisfaction.

Humana Financial Statement Overview

Summary

Humana shows strong financial performance with consistent revenue growth and robust profitability metrics. The balance sheet demonstrates financial stability with controlled leverage, though ROE has slightly declined. Cash flow analysis indicates healthy operational cash generation, despite mixed free cash flow growth.

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
120.26B	117.76B	106.37B	92.87B	83.06B	77.16B
	Gross Profit
120.26B	117.76B	106.37B	92.87B	83.06B	77.16B
	EBIT
3.34B	2.56B	4.01B	3.80B	3.15B	4.99B
	EBITDA
4.12B	3.53B	4.93B	4.64B	3.86B	5.60B
	Net Income Common Stockholders
1.71B	1.21B	2.49B	2.81B	2.93B	3.37B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
22.14B	20.43B	21.32B	5.06B	3.39B	4.67B
	Total Assets
50.93B	46.48B	47.06B	43.05B	44.36B	34.97B
	Total Debt
13.31B	11.72B	11.66B	11.42B	12.82B	6.98B
	Net Debt
9.06B	9.50B	6.96B	6.36B	9.43B	2.31B
	Total Liabilities
33.11B	30.03B	30.75B	9.03B	10.54B	6.06B
	Stockholders Equity
17.75B	16.38B	16.26B	15.31B	16.08B	13.73B
Cash Flow		Free Cash Flow
2.38B	2.39B	2.98B	3.47B	946.00M	4.67B
	Operating Cash Flow
2.87B	2.97B	3.98B	4.59B	2.26B	5.64B
	Investing Cash Flow
-2.22B	-2.95B	-3.49B	-1.01B	-6.56B	-3.06B
	Financing Cash Flow
-2.31B	-2.49B	-856.00M	-1.91B	3.02B	-1.96B

Humana Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 235.26
• 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 Neutral. The current price of 235.26 is above the 20-day moving average (MA) of 233.83, below the 50-day MA of 250.58, and below the 200-day MA of 270.98, indicating a neutral trend. The MACD of -4.36 indicates Negative momentum. The RSI at 47.27 is Neutral, neither overbought nor oversold. The STOCH value of 67.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HUM.

Humana Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNC	77 Outperform	$27.48B	8.22	12.59%	―	8.85%	33.30%
MOH	76 Outperform	$16.16B	14.40	26.72%	―	16.71%	12.23%
HLN	73 Outperform	$48.26B	26.93	8.90%	2.15%	2.16%	43.24%
HUM	72 Outperform	$28.39B	16.63	10.09%	1.50%	10.09%	-12.18%
ALNY	64 Neutral	$40.16B	―	-414.62%	―	17.21%	21.16%
Sector *	54 Neutral	$5.37B	3.26	-45.10%	3.30%	16.81%	0.02%
VTRS	53 Neutral	$10.47B	―	-21.25%	5.38%	-6.88%	-6809.78%

Humana Corporate Events

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.

Humana Reports Strong Q1 2025 Financial Results

Humana Inc. reported its financial results for the first quarter of 2025, noting a GAAP earnings per share (EPS) of $10.30 and an adjusted EPS of $11.58. The company affirmed its full-year 2025 adjusted EPS guidance of approximately $16.25, while revising its GAAP EPS guidance to approximately $14.68. Despite an anticipated decline in individual Medicare Advantage membership, Humana remains confident in its pricing strategy and long-term value creation. The company also highlighted progress in its CenterWell and Medicaid businesses, including a new contract in Illinois for a dual eligible special needs plan program.