HUM Stock Recent News

Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?

The DividendRank formula at Dividend Channel ranks a coverage universe of thousands of dividend stocks, according to a proprietary formula designed to identify those stocks that combine two important characteristics — strong fundamentals and a valuation that looks inexpensive. Humana presently has an above average rank, in the top 50% of the coverage universe, which suggests it is among the top most "interesting" ideas that merit further research by investors.

Humana Inc. investors have experienced a significant drop in the company's stock price, reaching lows not seen since January 2022, making a two-year round trip. The concerns over Humana's poor operating performance and shocking guidance for 2024 are justified, leading to the steep selloff. The company downgraded its 2024 outlook and stated that previous forecasts for 2025 are no longer achievable. As a result, growth-focused investors likely exited.

Health insurance carrier Humana Inc. NYSE: HUM reported a bombshell when it released its fourth-quarter 2023 earnings report. The company not only missed its estimated EPS by a mile but also slashed its 2024 and 2025 EPS guidance by more than 50% to 75%, respectively.

Humana's Q4 results fell well short of consensus and guidance for fiscal year 2024 is significantly lower, leading to an 11% drop in stock. Analysts were surprised by the big earnings per share miss and the lowered guidance, as other Medicare Advantage providers reported solid results and maintained their guidance. Humana's management cited increased medical costs and utilization of benefits as the primary factors for the poor earnings, and the company may need to raise rates to meet surging costs.

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Humana announced a surprise quarterly loss on higher medical cost trends to end 2023. Management also issued disappointing forward earnings guidance.

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Humana (HUM) expects 2024 revenues to increase to around $113 billion.

The medical cost increases reflect an increasing number of older adults returning to hospitals to undergo procedures they had delayed during the pandemic.