| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 40 | 38.6x | 17.8x | Bottom tier | |
Growth | 73 | 18.3% | 7.1% | Top tier | |
Quality | 28 | 7.4% | 4.5% | Bottom tier | |
Safety | 48 | 2.3x | 2.6x | Around median | |
Capital Return | 32 | 0.87% | 2.12% | Bottom tier | |
Momentum | 95 | 24.3% | 2.9% | Top tier | |
Sentiment | 82 | 17 | 3 | Top tier |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Humana Inc. is a healthcare company focused on Medicare Advantage plans, alongside Part D drug plans, a Medicaid platform, and CenterWell services. Revenue is derived primarily from health plan membership and funding, while the company seeks to improve care outcomes and control costs through value-based care providers, expand CenterWell services, and increase operational efficiency.
In Q2 fiscal 2026, adjusted revenue reached $40.9 billion, representing year-over-year growth of 26.2% driven by increased medical membership. GAAP net income was $694 million, and diluted earnings per share were $5.73, while adjusted earnings per share reached $7.61 and exceeded expectations by 22.4%. Despite revenue growth, the net margin remained at 0.8% and the operating margin at 1.8% according to data from July 29, 2026, highlighting the gap between business volume expansion and weak conversion of revenue into profit.
The recovery story depends on improving Medicare Advantage profitability and developing the plan mix, alongside growth in CenterWell and Medicaid. Management is targeting a sustainable pre-tax margin of at least 3% in fiscal 2028, after doubling the individual Medicare Advantage margin in fiscal 2026 excluding the impact of Stars ratings, and achieving further progress in fiscal 2027 through benefit adjustments and selective exits from low-return plans.
The analyst consensus is Neutral, with an average price target of $418.53 and a wide range between $300 and $513; the average is below the 52-week range high of $428.88, while the highest target exceeds that high and the lowest target falls clearly below it. This dispersion reflects disagreement over Humana's ability to convert revenue growth into a sustainable margin of at least 3% in fiscal 2028, particularly with a price-to-earnings ratio of 38.9 times according to data from July 29, 2026 and pressures from care costs and Stars ratings.
Figures in the text are as of 2026-08-27; the live price is shown at the top of the page.
Adjusted revenue reached $40.9 billion, representing a year-over-year increase of 26.2% driven by medical membership growth. The company recorded GAAP net income of $694 million and diluted earnings per share of $5.73. Adjusted earnings per share reached $7.61, exceeding expectations by 22.4%. Humana reaffirmed its adjusted financial outlook for the full fiscal 2026 on July 29, 2026.
The company is targeting a sustainable pre-tax margin of at least 3% in fiscal 2028. The path depends on clinical and operational efficiency, Medicare Advantage benefit adjustments, improving the plan mix, and exiting low-return plans. In Q2 fiscal 2026, the consolidated operating cost ratio declined by 120 basis points year over year, with an expected decline of approximately 150 basis points for the full year. Fiscal 2027 exits will affect approximately 600,000 members, with an effort to recapture a significant portion of them within higher-performing plans.
Stars affect quality revenue and the rebates retained by Medicare Advantage plans, so Humana is targeting monthly Stars revenue per member that is more than 10% above the peer median. In the 2028 bonus year cycle, the pace of improvement exceeded historical levels in 11 out of 12 selected HEDIS and patient safety measures. Quality improvement per member across key HEDIS measures was also 5% ahead of the prior year's pace by the end of Q2 fiscal 2026. However, the company does not know the final CMS thresholds in advance and cannot guarantee the outcome.
Automated analysis for informational purposes only — not investment advice.
Management said on July 29, 2026 that the medical and drug cost trend remained within its assumption of 7% to 8% for fiscal 2026. Inpatient services showed some improvement through lower admissions per thousand members and a lower cost per case, and performance was relatively better among members attributed to value-based care providers. In contrast, the drug cost trend remained in the double digits, and management expects it to rise modestly in fiscal 2027 due to new drugs. Therefore, margin improvement remains linked to continued utilization control and risk-appropriate pricing.
The company completed the acquisition of MaxHealth for approximately $908 million. In return, it announced the sale of its minority stake in Gentiva for approximately $900 million, with the transaction expected to close in Q4 fiscal 2026 and the proceeds to be used to finance most of the acquisition. It also established a $1.5 billion contingent capital facility with 10- and 30-year maturities and does not expect to draw on it in the near or medium term. The company is also expanding its Medicaid platform through the Illinois statewide contract scheduled to begin operations in January 2027.
On August 25, 2026, DaVita announced a value-based care agreement with Humana for Medicare Advantage members. The agreement includes more than 10,000 patients in stages 3B to 5 of chronic kidney disease. It focuses on early intervention and multidisciplinary care with the aim of stabilizing kidney function and slowing its deterioration. The agreement aligns with Humana's data showing relatively better cost performance for members attributed to value-based care providers in Q2 fiscal 2026.
