Fundamental Analysis of HUMANA INC(NYSE:HUM) stock

Fundamental Rating

Overall HUM gets a fundamental rating of 4 out of 10. We evaluated HUM against 118 industry peers in the Health Care Providers & Services industry. There are concerns on the financial health of HUM while its profitability can be described as average. HUM has a decent growth rate and is not valued too expensively. Finally HUM also has an excellent dividend rating.

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1. Profitability

1.1 Basic Checks

HUM had positive earnings in the past year.

HUM had a negative operating cash flow in the past year.

HUM had positive earnings in each of the past 5 years.

In the past 5 years HUM always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of HUM (3.97%) is better than 75.86% of its industry peers.

HUM has a Return On Equity of 12.34%. This is amongst the best in the industry. HUM outperforms 80.17% of its industry peers.

The Return On Invested Capital of HUM (7.40%) is better than 77.59% of its industry peers.

HUM had an Average Return On Invested Capital over the past 3 years of 8.25%. This is in line with the industry average of 8.58%.

		Industry Rank	Sector Rank
ROA	3.97%
ROE	12.34%
ROIC	7.4%

ROA(3y)6.14%

ROA(5y)7.47%

ROE(3y)17.29%

ROE(5y)19.78%

ROIC(3y)8.25%

ROIC(5y)9.55%

1.3 Margins

Looking at the Profit Margin, with a value of 1.82%, HUM is in the better half of the industry, outperforming 67.24% of the companies in the same industry.

HUM's Profit Margin has declined in the last couple of years.

HUM has a Operating Margin (3.76%) which is comparable to the rest of the industry.

HUM's Operating Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	3.76%
PM (TTM)	1.82%
GM	N/A

OM growth 3Y-12.77%

OM growth 5Y-4.67%

PM growth 3Y-18.76%

PM growth 5Y-4.58%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HUM is still creating some value.

HUM has less shares outstanding than it did 1 year ago.

HUM has less shares outstanding than it did 5 years ago.

Compared to 1 year ago, HUM has an improved debt to assets ratio.

2.2 Solvency

HUM has a Debt/Equity ratio of 0.78. This is a neutral value indicating HUM is somewhat dependend on debt financing.

HUM has a Debt to Equity ratio (0.78) which is comparable to the rest of the industry.

		Industry Rank	Sector Rank
Debt/Equity	0.78
Debt/FCF	N/A
Altman-Z	N/A

ROIC/WACC0.96

WACC7.7%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

HUM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -10.21%.

The Earnings Per Share has been growing by 12.30% on average over the past years. This is quite good.

HUM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.22%.

HUM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 13.33% yearly.

EPS 1Y (TTM)-10.21%

EPS 3Y11.52%

EPS 5Y12.3%

EPS growth Q2Q-22.92%

Revenue 1Y (TTM)14.22%

Revenue growth 3Y11.3%

Revenue growth 5Y13.33%

Revenue growth Q2Q10.73%

3.2 Future

The Earnings Per Share is expected to grow by 15.12% on average over the next years. This is quite good.

HUM is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.34% yearly.

EPS Next Y-36.42%

EPS Next 2Y-4.71%

EPS Next 3Y4.92%

EPS Next 5Y15.12%

Revenue Next Year8.06%

Revenue Next 2Y5.84%

Revenue Next 3Y5.52%

Revenue Next 5Y8.34%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 13.45, HUM is valued correctly.

Based on the Price/Earnings ratio, HUM is valued cheaper than 91.38% of the companies in the same industry.

When comparing the Price/Earnings ratio of HUM to the average of the S&P500 Index (28.28), we can say HUM is valued rather cheaply.

Based on the Price/Forward Earnings ratio of 13.58, the valuation of HUM can be described as correct.

Based on the Price/Forward Earnings ratio, HUM is valued cheaply inside the industry as 82.76% of the companies are valued more expensively.

HUM is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.88, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	13.45
Fwd PE	13.58

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, HUM is valued cheaper than 82.76% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	9.06

4.3 Compensation for Growth

PEG (NY)N/A

PEG (5Y)1.09

EPS Next 2Y-4.71%

EPS Next 3Y4.92%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 1.10%, HUM has a reasonable but not impressive dividend return.

Compared to an average industry Dividend Yield of 2.73, HUM pays a better dividend. On top of this HUM pays more dividend than 84.48% of the companies listed in the same industry.

With a Dividend Yield of 1.10, HUM pays less dividend than the S&P500 average, which is at 2.41.

		Industry Rank	Sector Rank
Dividend Yield	1.1%

5.2 History

The dividend of HUM is nicely growing with an annual growth rate of 12.51%!

HUM has paid a dividend for at least 10 years, which is a reliable track record.

HUM has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.

Dividend Growth(5Y)12.51%

Div Incr Years7

Div Non Decr Years7

5.3 Sustainability

HUM pays out 22.10% of its income as dividend. This is a sustainable payout ratio.

The dividend of HUM is growing, but earnings are growing more, so the dividend growth is sustainable.

DP22.1%

EPS Next 2Y-4.71%

EPS Next 3Y4.92%

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HUMANA INC

NYSE:HUM (5/3/2024, 7:04:00 PM)

After market: 320.54 0 (0%)

320.54

-0.44 (-0.14%)

Chartmill FA Rating

GICS SectorHealth Care

GICS IndustryGroupHealth Care Equipment & Services

GICS IndustryHealth Care Providers & Services

Earnings (Last)

Earnings (Next)

Inst Owners

Inst Owner Change

Ins Owners

Ins Owner Change

Market Cap38.63B

Analysts

Price Target

Dividend

		Industry Rank	Sector Rank
Dividend Yield	1.1%

Dividend Growth(5Y)

Div Incr Years

Div Non Decr Years

Ex-Date

Surprises & Revisions

EPS beat(2)

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PT rev (1m)

PT rev (3m)

EPS NQ rev (1m)

EPS NQ rev (3m)

EPS NY rev (1m)

EPS NY rev (3m)

Revenue NQ rev (1m)

Revenue NQ rev (3m)

Revenue NY rev (1m)

Revenue NY rev (3m)

Valuation

		Industry Rank	Sector Rank
PE	13.45
Fwd PE	13.58
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA

EPS(TTM)

EPS(NY)

Fwd EY

FCF(TTM)

FCFY

OCF(TTM)

OCFY

SpS

BVpS

TBVpS

PEG (NY)N/A

PEG (5Y)1.09

Profitability

		Industry Rank	Sector Rank
ROA	3.97%
ROE	12.34%
ROCE
ROIC
ROICexc
ROICexgc
OM	3.76%
PM (TTM)	1.82%
GM	N/A
FCFM

ROA(3y)

ROA(5y)

ROE(3y)

ROE(5y)

ROIC(3y)

ROIC(5y)

ROICexc(3y)

ROICexc(5y)

ROICexgc(3y)

ROICexgc(5y)

ROCE(3y)

ROCE(5y)

ROICexcg growth 3Y

ROICexcg growth 5Y

ROICexc growth 3Y

ROICexc growth 5Y

OM growth 3Y

OM growth 5Y

PM growth 3Y

PM growth 5Y

GM growth 3Y

GM growth 5Y

F-Score

Asset Turnover2.18

Health

		Industry Rank	Sector Rank
Debt/Equity	0.78
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio	N/A
Quick Ratio	N/A
Altman-Z

F-Score

WACC

ROIC/WACC

Cap/Depr(3y)

Cap/Depr(5y)

Cap/Sales(3y)

Cap/Sales(5y)

Profit Quality(3y)

Profit Quality(5y)

Growth

EPS 1Y (TTM)-10.21%

EPS 3Y11.52%

EPS 5Y

EPS growth Q2Q

EPS Next Y-36.42%

EPS Next 2Y

EPS Next 3Y

EPS Next 5Y

Revenue 1Y (TTM)14.22%

Revenue growth 3Y11.3%

Revenue growth 5Y

Revenue growth Q2Q

Revenue Next Year

Revenue Next 2Y

Revenue Next 3Y

Revenue Next 5Y

EBIT growth 1Y

EBIT growth 3Y

EBIT growth 5Y

EBIT Next Year

EBIT Next 3Y

EBIT Next 5Y

FCF growth 1Y

FCF growth 3Y

FCF growth 5Y

OCF growth 1Y

OCF growth 3Y

OCF growth 5Y

HUMANA INC (HUM)

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

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2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

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3. Growth

3.1 Past

3.2 Future

3.3 Evolution

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4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

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5. Dividend

5.1 Amount

5.2 History

5.3 Sustainability

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