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Humana Inc., headquartered in Louisville, Kentucky (HUM) is a health and wellness company focused on serving individuals, families, military service personnel, and communities through its insurance services and care delivery operations. Valued at a market capitalization of $29.3 billionThe company offers health and specialty insurance products, including Medicare Advantage, stand-alone prescription drug plans, and dental and vision benefits, and operates clinical care services through its CenterWell division.
This healthcare company has significantly underperformed the broader market over the past 52 weeks. HUM Stock Has decreased 13.1% during this time period, while the broader S&P 500 index ($SPX) has won 14.1%. Additionally, on a year-over-year basis, the stock is down 4.1%, compared to SPX’s 16.4% return.
To narrow the focus, HUM has also lagged the iShares US Healthcare ETF (JIA) marginal rebound in the last 52 weeks and an increase of 8.8% year to date.
On November 5, HUM shares fell 6% after his Q3 publication of results, despite offering a better than expected performance. Both the company’s adjusted revenue of $32.6 billion and adjusted EPS of $3.24 surpassed consensus estimates. In addition, its revenue increased 11.4% compared to the same period last year. However, its bottom line declined 22.1% from the prior-year quarter, raising concerns about declining profitability and shrinking margins, triggering a sharp sell-off in its shares.
For the current fiscal year, which ends in December, analysts expect HUM EPS to grow 5.4% year over year at $17.08. The company’s history of earnings surprises is mixed. It beat consensus estimates in three of the last four quarters, although it missed out on another occasion.
Among the 27 analysts covering the stock, the consensus rating is “Moderate purchase”, which is based on seven “Strong Buy”, two “Moderate Buy”, 17 “Hold” and one “Strong Sell” ratings.
This setup is less bullish than a month ago, with no analysts suggesting a “Strong Sell” rating.
On November 10, Truist Financial Corporation (TFC) kept a “Hold” on HUM, but lowered its price target to $285, indicating 16.3% upside potential from current levels.
The average price target of $285.50 represents a 16.5% premium to HUM’s current price levels, while the Street’s high price target of $341 suggests 39.1% upside potential.
On the date of publication, Neharika Jain had no (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. For more information, see Barchart’s Disclosure Policy here.
