Humana (HUM) Downgraded by Zacks Investment Research
Zacks Investment Research lowered shares of Humana (NYSE:HUM) from a buy rating to a hold rating in a research report sent to investors on Tuesday.
According to Zacks, “Humana’s shares have outperformed the industry year to date. The company is well poised to grow on its strong government business. Its top line has been witnessing an uptrend for past many years. Sufficient generation of cash flow has helped the company take up several capital deployment initiatives aimed at enhancing shareholders’ value. Humana’s sound balance sheet and disciplined capital management remain major tailwinds. Following decent 2017 results, the company provided strong guidance for 2018. The company has seen the Zacks Consensus Estimate for 2018 earnings being revised upward in the last 60 days. However, the company's individual commercial business has remained a drag over past few years. Rising level of expenses also continues to weigh on the bottom line.”
Other research analysts also recently issued reports about the company. Cowen reiterated a buy rating and set a $285.00 target price on shares of Humana in a research note on Wednesday, December 13th. Jefferies Group upgraded Humana from a hold rating to a buy rating and set a $221.00 target price for the company in a research note on Friday, January 12th. Goldman Sachs Group initiated coverage on Humana in a research note on Wednesday, January 3rd. They set a buy rating and a $305.00 target price for the company. ValuEngine downgraded Humana from a buy rating to a hold rating in a research note on Tuesday, December 19th. Finally, Cantor Fitzgerald reiterated a hold rating and set a $230.00 target price on shares of Humana in a research note on Tuesday, December 5th. Eight investment analysts have rated the stock with a hold rating and fourteen have assigned a buy rating to the stock. Humana currently has a consensus rating of Buy and a consensus target price of $270.47.
Humana (NYSE:HUM) last issued its earnings results on Wednesday, February 7th. The insurance provider reported $2.06 EPS for the quarter, topping the Thomson Reuters’ consensus estimate of $2.00 by $0.06. Humana had a return on equity of 16.13% and a net margin of 4.55%. The company had revenue of $13.19 billion during the quarter, compared to the consensus estimate of $13.14 billion. During the same period in the previous year, the company posted $2.34 EPS. The firm’s revenue for the quarter was up 2.4% compared to the same quarter last year. research analysts anticipate that Humana will post 13.81 earnings per share for the current fiscal year.
The company also recently declared a quarterly dividend, which will be paid on Friday, April 27th. Investors of record on Friday, March 30th will be issued a dividend of $0.50 per share. This is a boost from Humana’s previous quarterly dividend of $0.40. This represents a $2.00 annualized dividend and a yield of 0.74%. The ex-dividend date is Wednesday, March 28th. Humana’s dividend payout ratio (DPR) is presently 9.59%.
Humana announced that its board has authorized a stock buyback program on Thursday, December 14th that permits the company to buyback $3.00 billion in shares. This buyback authorization permits the insurance provider to purchase shares of its stock through open market purchases. Shares buyback programs are generally an indication that the company’s management believes its stock is undervalued.
In related news, VP Timothy S. Huval sold 1,382 shares of Humana stock in a transaction that occurred on Tuesday, December 19th. The stock was sold at an average price of $246.04, for a total transaction of $340,027.28. Following the completion of the sale, the vice president now directly owns 11,557 shares of the company’s stock, valued at approximately $2,843,484.28. The transaction was disclosed in a legal filing with the SEC, which is accessible through the SEC website. Also, CEO Bruce D. Broussard sold 14,075 shares of Humana stock in a transaction that occurred on Monday, February 26th. The stock was sold at an average price of $274.32, for a total value of $3,861,054.00. Following the sale, the chief executive officer now directly owns 113,896 shares of the company’s stock, valued at $31,243,950.72. The disclosure for this sale can be found here. Over the last three months, insiders have sold 41,775 shares of company stock valued at $11,169,845. 0.60% of the stock is currently owned by insiders.
A number of hedge funds and other institutional investors have recently made changes to their positions in the business. Cambridge Investment Research Advisors Inc. raised its holdings in Humana by 18.8% in the 4th quarter. Cambridge Investment Research Advisors Inc. now owns 3,372 shares of the insurance provider’s stock valued at $836,000 after acquiring an additional 534 shares in the last quarter. Certified Advisory Corp acquired a new position in Humana in the 4th quarter valued at $109,000. Colonial Trust Advisors acquired a new position in Humana in the 4th quarter valued at $13,780,000. Xact Kapitalforvaltning AB raised its holdings in Humana by 6.9% in the 4th quarter. Xact Kapitalforvaltning AB now owns 24,981 shares of the insurance provider’s stock valued at $6,197,000 after acquiring an additional 1,606 shares in the last quarter. Finally, OLD Mutual Customised Solutions Proprietary Ltd. raised its holdings in Humana by 41.8% in the 4th quarter. OLD Mutual Customised Solutions Proprietary Ltd. now owns 9,159 shares of the insurance provider’s stock valued at $2,272,000 after acquiring an additional 2,700 shares in the last quarter. 97.85% of the stock is owned by hedge funds and other institutional investors.
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Humana Inc is a health and well-being company. The Company’s segments include Retail, Group and Specialty, Healthcare Services and Individual Commercial. The Retail segment consists of Medicare benefits, as well as individual commercial fully insured medical and specialty health insurance benefits, including dental, vision, and other supplemental health and financial protection products.
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