HUM US S&P 500Russell 1000 Earnings call
Humana (HUM) · Q1 2026 results and valuation
Share price: $446.31 · 2026-11-11
Humana provides health insurance services and healthcare services, including pharmacy solutions and primary care. The company serves Medicare and Medicaid participants, individuals, and military personnel through its insurance and CenterWell segments. It operates in the United States, offering products across all 50 states. Source: 10-K annual report (2026-02-19)
Results Q1 2026 vs Q4 2025 · previous quarter · published 29 Apr 2026 and 11 Feb 2026
Net income turned to a profit from a loss last quarter. Management sounded about as positive as a typical company call, in its script and in answers to analysts.
1 · Numbers
Turned profit
Net income vs Q4 2025
Outlook given
Net income 1.19B vs -796.0M
Revenue +21.9%
2 · How management spoke
Typical
Less upbeat than 65% of company calls
Answers to analysts: typical, in line with the script.
Similar to last call.
3 · What stood out
Humana expects to double individual MA margin in 2026 adjusted for Stars.
Valuation
Is Humana undervalued?
Reverse DCF on net income from the last full fiscal year (no meaningful free cash flow: a bank, insurer or a year of negative cash flow) (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 10.0% growth a year (3-year revenue growth), the model's fair value is $136.05 a share — the stock trades 228% above it. Today's price assumes 25.8% growth a year.
Current price
$446.31
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+25.8% for 10 yrs
Fair value / share
$136.05
Buy below
$102.04
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
-
Guidance
The company expects to double individual MA margin in 2026 adjusted for Stars.
-
Key theme
Key indicators for both new and concurrent members, including APTs, authorizations, pharmacy, and MRA, are lining up according to expectations.
Source quote
“It's not perfect information by any means, but as Celeste has mentioned, all the key indicators of both our new and concurrent members we have, and those are lining up according to expectations, our APTs, our authorizations, pharmacy, MRA, all those things are lining up the way that we are expecting, as Celeste mentioned in her opening comments.”
-
Guidance
HUM reported unexpected transaction and integration costs from the Max Health acquisition that were not previously included in the Q1 guidance.
-
Key theme
New patient engagement metrics are tracking in line with expectations as an early indicator for the company.
Source quote
“As an early indicator, though, some of the things that we track are engagement of those new patients and those are tracking very much in line with expectations.”
-
Figure
Management emphasized planning for the next 2 to 3 years to account for external environment changes and ensure contingency plans can accommodate unknown variables.
Source quote
“We should always be looking out 2 to 3 years in trying to understand how the external environment might evolve and making sure that we are putting in place plans and contingency plans that can accommodate the unknown across that period of time.”
4 more
-
Key theme
The company reported that its member growth trajectory is on track for the quarter.
Source quote
“First of all, our member growth trajectory is on track.”
-
Key theme
Medical cost trends continue to outpace program funding, impacting the company's cost management for the quarter.
Source quote
“Nevertheless, medical cost trend continues to outpace program funding.”
-
Figure
The company reported being 5% ahead of last year's GAAP closure pace on a per member basis on certain key HEDIS metrics at the end of Q1.
Source quote
“And as a result, at the end of Q1, we are about 5% ahead of last year's GAAP closure pace on a per member basis on certain key HEDIS metrics.”
-
Figure
The company's primary priorities are staying on track for 2028 and minimizing churn to retain existing members because churn is expensive.
Source quote
“The priority is; Number 1, being on track for 2028, and; and Number 2, retaining the members that we have because, again, churn is expensive, and we want to minimize churn the most we can.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q1 2026. Ring: Q4 2025.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“First is product and experience, which drive customer retention and growth; second is clinical excellence, which delivers clinical outcomes in medical margin; third, highly efficient operations; and fourth, capital allocation...”
“In the first quarter of last year, I posited that there was a real opportunity to increase the efficiency and resiliency of our balance sheet.”
“We've been improving productivity and increasing volume discounts, while also improving payment terms with vendors.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-03-31)
| Metric | Q1 2026period end 2026-03-31 | Q4 2025period end 2025-12-31 | Change | Q1 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 39.65B | 32.52B | +21.9% | 32.11B | +23.5% |
| Operating income | 1.75B | -808.0M | Turned profit | 2.01B | −12.9% |
| Net income | 1.19B | -796.0M | Turned profit | 1.24B | −4.7% |
| EPS | 9.83 | -6.59 | Turned profit | 10.30 | −4.6% |
| P/E today 42.3 | 18.5 | 26.0 | −7.5 | 18.7 | −0.2 |
Topics
Most discussed now
- New This important work improves visibility into cost trends and further strengthens payment integrity.
- New Humana has been improving productivity and increasing volume discounts, while also improving payment terms with vendors.
- This data, including what Humana continues to monitor in April, includes risk scores, hospital admits per thousand, or APTs, pharmacy...
- Humana continues to enhance its claims and cost trend monitoring practices, including anomaly detection to identify and react to claims...
- Humana is making great progress against its operating cost targets.
Faded since Q4 2025
- Dropped Actually, Humana's star spend is is fairly consistent with last year on an absolute dollar basis, but on a...
- Fading To be able to provide excellent health outcomes and service.
- Fading Humana expects the membership to drive significant lifetime value further fueling its ability to unlock the earnings potential...
- Fading While Humana doesn't provide cohort level margin information for competitive reasons, I'm gonna give you a little more detail this...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations; Regulation FD disclosure · SEC 8-K
- Regulation FD disclosure · SEC 8-K
Humana entered a new joint venture with BlackRock to manage nearly 150 CenterWell clinics, with BlackRock acquiring WCAS's equity stake valued at approximately $2.8 billion.
- Regulation FD disclosure · SEC 8-K
Humana Inc. exceeded its goal of Top Quartile results for 2027 Medicare Advantage Star Ratings based on data provided by CMS on October 8, 2026.
- Regulation FD disclosure · SEC 8-K
Humana Inc. reaffirmed its FY 2026 guidance of at least $6.52 in diluted EPS and at least $9.00 in adjusted EPS.
- Director or officer change · SEC 8-K
Humana Inc. expanded its board of authorized directors from eleven to thirteen and elected Frederick J. Crawford and Paul J. Smith as independent directors effective July 28, 2026.
- Results of operations; Regulation FD disclosure · SEC 8-K
Humana reported 2Q26 GAAP earnings per share of $5.73, up from $4.51 in 2Q25, and year-to-date GAAP earnings per share of $15.55 compared to $14.81 in 2025.
- Regulation FD disclosure · SEC 8-K
Humana Inc. reaffirmed its FY 2026 guidance of at least $8.36 in diluted EPS and at least $9.00 in adjusted EPS.
- Material agreement; New financial obligation · SEC 8-K
Humana Inc. entered into agreements for the issuance of 2036 and 2055 Senior Notes, providing the company with up to $1.5 billion in total potential capital through two trusts.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
-
2028
returning to a sustainable margin of at least 3%
Source quote
“And right now, second headline, we are turning our attention to bids and we are approaching bids with a focus on returning to a sustainable margin of at least 3% in 2028 and making progress against that in 2027.”
-
2027
making progress against the 2028 commitment
Source quote
“We know that we need to make some progress against that in 2027.”
-
2028
returning to a sustainable margin of at least 3%
Source quote
“And so our third takeaway, which is something we have noted previously, is that we will adjust benefits to remain on track to deliver our 2028 commitment of returning to a sustainable margin of at least 3%.”
-
2027
making progress towards the 2028 goal
Source quote
“And again, we expect to make the necessary progress towards that goal in 2027.”
-
BY '28
return to top quartile Stars results
Source quote
“Our outlook on BY '28 Stars has not changed.”