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Factors that Make Humana (HUM) an Attractive Bet Now
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Humana Inc. (HUM - Free Report) remains well-poised for growth, courtesy of solid premium revenues, numerous acquisitions, upbeat financial guidance for 2022 and adequate cash-generating abilities.
Zacks Rank & Price Performance
Humana carries a Zacks Rank #2 (Buy) currently.
The stock has gained 4.4% year to date compared with the industry’s rally of 3.4%. The Zacks Medical sector and the S&P 500 composite have lost 21.5% and 18.3%, respectively.
Image Source: Zacks Investment Research
Favorable Style Score
Humana carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score, when combined with a solid Zacks Rank, are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for HUM’s 2022 earnings is pegged at $24.85 per share, indicating an increase of 20.4% on 11.9% higher revenues of $92.9 billion. The consensus mark for 2023 earnings stands at $27.78 per share, suggesting growth of 11.8% on 8.9% higher revenues of $101.2 billion.
Sound Earnings Surprise History
Humana boasts a strong earnings surprise record. It surpassed earnings estimates in each of the trailing four quarters, the average surprise being 9.09%.
Valuation
Price-to-earnings (P/E) is one of the multiples used for valuing healthcare stocks. Compared with the health maintenance organization industry’s trailing 12-month P/E ratio of 18, Humana has a reading of 20.1. It is quite evident that the stock is currently undervalued.
Solid 2022 Outlook
Humana anticipates revenues between $91.6 billion and $93.2 billion, the mid-point of which indicates an improvement of 11.2% from 2021 reported figure.
HUM estimates adjusted earnings per share to be roughly $24.75 this year, which implies a rise of 20% from the reported figure of 2021.
Business Tailwinds
Revenues of Humana continue to benefit from higher premium revenues stemming from membership growth in its well-performing Medicaid and Medicare businesses. Through these businesses, HUM devises affordable health plans and foray deeper into several U.S. communities. An aging U.S. population is likely to sustain solid demand for the Medicare plans of Humana.
The strength of such plans continues to fetch numerous contract wins and renewed agreements with Humana from various U.S. state authorities.
To bring about better whole-person health outcomes, the CenterWell brand was launched by Humana last year in March to integrate three of its major payer-agnostic healthcare service offerings, such as primary care, pharmacy and home health under a single umbrella. Worth mentioning that the integration of the services was completed within a year and a half from the time of the brand launch. The services offered by the brand can be availed by not only Humana’s health plan members but also by clients of various other health plans. This is expected to further boost HUM’s membership growth and premium revenue.
A series of acquisitions undertaken over the years, including those of Family Physicians Group, onehome, Curo and Kindred at Home has bolstered the capabilities, diversified income streams and extended the nationwide presence of Humana.
HUM boasts a solid cash position through which it can effectively service its debt obligations. Strong cash-generating abilities enable the health insurer to pursue significant business investments or prudently deploy capital via share buybacks and dividend hikes.
Other Stocks to Consider
Some other top-ranked stocks in the Medical space include ShockWave Medical, Inc. , Lantheus Holdings, Inc. and AMN Healthcare Services, Inc. (AMN - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ShockWave Medical’s earnings surpassed estimates in each of the last four quarters, the average being 180.14%. The Zacks Consensus Estimate for SWAV’s 2022 earnings is pegged at $2.57 per share. A loss of 26 cents was reported in the prior year. The consensus mark for SWAV’s 2022 earnings has moved 27.2% north in the past 30 days.
Lantheus’ earnings beat estimates in each of the trailing four quarters, the average beat being 54.60%. The Zacks Consensus Estimate for LNTH’s 2022 earnings is pegged at $3.57 per share, which indicates an increase of more than seven-fold from the prior year reading. The consensus mark for LNTH’s 2022 earnings has moved 15.9% north in the past 60 days.
The bottom line of AMN Healthcare outpaced estimates in each of the trailing four quarters, the average being 15.66%. The Zacks Consensus Estimate for AMN’s 2022 earnings indicates a rise of 40.2%, while the same for revenues suggests an improvement of 28.5% from the respective year-ago actuals. The consensus mark for AMN’s 2022 earnings has moved 0.9% north in the past 30 days.
Shares of ShockWave Medical and Lantheus have gained 63.8% and 171.6%, respectively, year to date. However, the AMN Healthcare stock has lost 17.4% in the same time frame.
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Factors that Make Humana (HUM) an Attractive Bet Now
Humana Inc. (HUM - Free Report) remains well-poised for growth, courtesy of solid premium revenues, numerous acquisitions, upbeat financial guidance for 2022 and adequate cash-generating abilities.
Zacks Rank & Price Performance
Humana carries a Zacks Rank #2 (Buy) currently.
The stock has gained 4.4% year to date compared with the industry’s rally of 3.4%. The Zacks Medical sector and the S&P 500 composite have lost 21.5% and 18.3%, respectively.
Image Source: Zacks Investment Research
Favorable Style Score
Humana carries an impressive Value Score of A. Value Score helps find stocks that are undervalued. Back-tested results have shown that stocks with a favorable Value Score, when combined with a solid Zacks Rank, are the best investment bets.
Robust Growth Prospects
The Zacks Consensus Estimate for HUM’s 2022 earnings is pegged at $24.85 per share, indicating an increase of 20.4% on 11.9% higher revenues of $92.9 billion. The consensus mark for 2023 earnings stands at $27.78 per share, suggesting growth of 11.8% on 8.9% higher revenues of $101.2 billion.
Sound Earnings Surprise History
Humana boasts a strong earnings surprise record. It surpassed earnings estimates in each of the trailing four quarters, the average surprise being 9.09%.
Valuation
Price-to-earnings (P/E) is one of the multiples used for valuing healthcare stocks. Compared with the health maintenance organization industry’s trailing 12-month P/E ratio of 18, Humana has a reading of 20.1. It is quite evident that the stock is currently undervalued.
Solid 2022 Outlook
Humana anticipates revenues between $91.6 billion and $93.2 billion, the mid-point of which indicates an improvement of 11.2% from 2021 reported figure.
HUM estimates adjusted earnings per share to be roughly $24.75 this year, which implies a rise of 20% from the reported figure of 2021.
Business Tailwinds
Revenues of Humana continue to benefit from higher premium revenues stemming from membership growth in its well-performing Medicaid and Medicare businesses. Through these businesses, HUM devises affordable health plans and foray deeper into several U.S. communities. An aging U.S. population is likely to sustain solid demand for the Medicare plans of Humana.
The strength of such plans continues to fetch numerous contract wins and renewed agreements with Humana from various U.S. state authorities.
To bring about better whole-person health outcomes, the CenterWell brand was launched by Humana last year in March to integrate three of its major payer-agnostic healthcare service offerings, such as primary care, pharmacy and home health under a single umbrella. Worth mentioning that the integration of the services was completed within a year and a half from the time of the brand launch. The services offered by the brand can be availed by not only Humana’s health plan members but also by clients of various other health plans. This is expected to further boost HUM’s membership growth and premium revenue.
A series of acquisitions undertaken over the years, including those of Family Physicians Group, onehome, Curo and Kindred at Home has bolstered the capabilities, diversified income streams and extended the nationwide presence of Humana.
HUM boasts a solid cash position through which it can effectively service its debt obligations. Strong cash-generating abilities enable the health insurer to pursue significant business investments or prudently deploy capital via share buybacks and dividend hikes.
Other Stocks to Consider
Some other top-ranked stocks in the Medical space include ShockWave Medical, Inc. , Lantheus Holdings, Inc. and AMN Healthcare Services, Inc. (AMN - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ShockWave Medical’s earnings surpassed estimates in each of the last four quarters, the average being 180.14%. The Zacks Consensus Estimate for SWAV’s 2022 earnings is pegged at $2.57 per share. A loss of 26 cents was reported in the prior year. The consensus mark for SWAV’s 2022 earnings has moved 27.2% north in the past 30 days.
Lantheus’ earnings beat estimates in each of the trailing four quarters, the average beat being 54.60%. The Zacks Consensus Estimate for LNTH’s 2022 earnings is pegged at $3.57 per share, which indicates an increase of more than seven-fold from the prior year reading. The consensus mark for LNTH’s 2022 earnings has moved 15.9% north in the past 60 days.
The bottom line of AMN Healthcare outpaced estimates in each of the trailing four quarters, the average being 15.66%. The Zacks Consensus Estimate for AMN’s 2022 earnings indicates a rise of 40.2%, while the same for revenues suggests an improvement of 28.5% from the respective year-ago actuals. The consensus mark for AMN’s 2022 earnings has moved 0.9% north in the past 30 days.
Shares of ShockWave Medical and Lantheus have gained 63.8% and 171.6%, respectively, year to date. However, the AMN Healthcare stock has lost 17.4% in the same time frame.