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Bernstein SocGen Group reiterated its Outperform rating and $313.00 price target on Humana (NYSE:HUM), a prominent healthcare provider with a market cap of $29.14 billion and strong financial health score of GREAT according to InvestingPro, following the company’s investor day held Monday in Louisville, Kentucky.
The healthcare insurer outlined its strategic direction through 2028 during the event, providing updates on key business lines and long-term guidance. With impressive revenue growth of 10.09% and a sustainable dividend yield of 1.47%, Bernstein expressed optimism about Humana’s sector turnaround opportunities in Individual Medicare Advantage and the potential return to higher Star ratings.
The research firm noted Humana’s long-term earnings per share growth projections exceed Bernstein’s current models, primarily driven by larger operating expense savings and better performance in non-Individual Medicare Advantage business lines.
Bernstein analysts highlighted execution challenges in Humana’s strategy, noting management’s decision not to cut benefits in 2026 while simultaneously focusing on long-term growth drivers that could delay earnings recovery, including further Medicaid expansion and Group Medicare Advantage growth.
The firm’s commentary followed Humana’s investor day presentation on Monday, where the company provided its strategic roadmap and discussed plans to return to Star ratings in the 70% or higher range for 4-star plans, which Bernstein believes should drive meaningful earnings improvement. Currently trading at a P/E ratio of 16.92, InvestingPro analysis indicates the stock is undervalued, with additional insights available in the comprehensive Pro Research Report.
In other recent news, Humana has outlined a comprehensive growth strategy during its investor day presentations, projecting significant earnings growth by 2028. The company anticipates pre-tax earnings growth of $3.3 billion to $4.4 billion, driven by improvements in segment earnings and enterprise operating leverage. Analysts from firms like TD Cowen and UBS have maintained their price targets, with TD Cowen estimating potential earnings per share of $37-$44 by 2028, compared to current estimates of around $32. RBC Capital also maintained its price target, expressing confidence in Humana’s long-term strategy despite short-term challenges. UBS highlighted Humana’s projected earnings per share of $36-44 by 2028, noting the potential for substantial growth from current levels. Meanwhile, Truist Securities adjusted its price target for Humana to $280, citing a lower assumed multiple while maintaining a Hold rating. Despite challenges with Stars ratings and margin recovery, Humana remains focused on leveraging growth in Medicare Advantage and expanding its Medicaid and CenterWell segments. These developments reflect Humana’s strategic focus on long-term stability and growth in the healthcare market.
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