$HUM (+0,8 %) | Humana Q3'24 Earnings Highlights:
🔹 Adjusted EPS: $4.16 (Est. $3.38) 🟢
🔹 Revenue: $29.4B (Est. $28.67B) 🟢; UP 11% YoY
FY24 Guidance:
🔹 Adj EPS: At least $16.00 (Est. $16.17) 🟡
🔹 GAAP EPS: At least $12.89
🔹 Insurance Segment Benefit Ratio: Approximately 90%
🔹 Capital Expenditures: ~$2.0B
🔹 Restructuring Costs: ~$400M
2025 Outlook:
🔹 Adjusted EPS: Expected to be at least in line with FY24 results (~$16.00) 🟡, lower than previous consensus of $19.69.
🔸 Individual Medicare Advantage (MA) membership is expected to decline by a few hundred thousand due to plan and county exits, though management reaffirms its competitive positioning.
Key Financial Metrics:
Insurance Segment:
🔹 Revenue: $28.37B (UP 11% YoY)
🔹 Benefit Expense Ratio: 90.6% (UP from 87.6% YoY)
🔹 Operating Cost Ratio: 9.2% (DOWN from 10.4% YoY)
🔹 Operating Income: $329M (DOWN 59% YoY)
CenterWell Segment:
🔹 Revenue: $5.04B (UP 8% YoY)
🔹 Operating Income: $439M (DOWN 3% YoY)
🔹 Operating Cost Ratio: 91.3% (UP from 90.3% YoY)
Operational Metrics:
🔹 Operating Cash Flows YTD: $3.5B
🔹 Debt-to-Total Capitalization: 42.3%
🔹 Days in Claims Payable (DCP): 40.7 (DOWN from 43.1)
Membership & Strategic Developments:
🔹 Individual Medicare Advantage Membership: Raised 2024 membership growth forecast by 40,000 to 265,000 (UP ~5%).
🔸 Plan exits and county changes expected to impact 2025 individual MA membership by a few hundred thousand.
CEO Commentary:
🔸 "We delivered strong results in Q3, exceeding EPS and revenue estimates. While we anticipate membership reductions in 2025 due to strategic exits, we remain confident in our competitive positioning."
Strategic Highlights:
🔸 Individual Medicare Advantage plan adjustments, including exits from select markets, align with long-term strategic goals.
🔸 Management affirms that competitive positioning remains solid, despite near-term membership adjustments.
