Home Sectors Healthcare Present Valuation: Humana (NYSE: HUM)

Present Valuation: Humana (NYSE: HUM)


Humana trades as part of the health care plans industry and is part of the healthcare sector. Humana Inc is a health care company that offers insurance products and health and wellness services. Its segments include Retail, Employer Group and Healthcare Services.

Previous Intraday Trading Performance:

The HUM stock showed a previous change of -1.67% with an open at 303.65 and a close of 298.89. It reached an intraday high of 303.84 and a low of 297.66.

SeekingAlpha:  Humana not on board with Trump’s proposed drug rebate program


The stock has a market cap of $40.5b with 135.6m shares outstanding, of which the float is 134.5m shares. Trading volume reached 696,006 shares compared to its average volume of 1,013,957 shares. Based on the current average volume and close price, the trading liquidity is good.

Historical Trading Performance:

Over the last five trading days, Humana shares returned -2.31% and in the past 30 trading days it returned 5.27%. Over three months, it changed -5.73%. In one year it has changed 3.33% and within that year its 52-week high was 355.88 and its 52-week low was 261.25. HUM stock is 14.41% above its 52 Week Low.

Our calculations show a 200 day moving average of 310.04 and a 50 day moving average of 297.73. Currently HUM stock is trading -3.60% below its 200 day moving average and may be a good opportunity to buy, but should check other indicators to confirm a buy signal.

CNBC:  Humana executives say Trump’s drug rebate proposal would raise premiums, restrict consumer choice


The last annual fiscal EPS for the company was reported at 16.76 that ended on 31st of December 2018, which according to the previous close, that is a PE of 17.83. Based on 10 analyst estimates, the consensus EPS for the next quarter is 2.53. The TTM EPS is 14.55, which comes to a TTM PE of 20.54. Historically, the PE high was 65.20 and the PE low was 8.80. If the stock reached its PE low, that would represent a price of 128.05, which is a decrease of -57.16%.

The following are the last four quarter reported earnings per share:
12-31-2018:  2.65
09-30-2018:  4.58
06-30-2018:  3.96
03-31-2018:  3.36

The dividend per share is currently 2.20, which is a dividend yield of 0.74%. Also, the payout ratio is 15.12%, therefore the dividend is safe according to our calculations.

Base on our calculations, the intrinsic value per share is 344.91, which means it is possibly undervalued and has a margin of safety of 13.34%

Indicators to Watch:

Based on the latest filings, there is 156.80% of institutional ownership. Short-interest is 2,054,604, which is 1.52% of shares outstanding. The short-interest ratio or days-to-cover ratio is 1.72. This stock has some short interest, but it may be normal and no cause for concern if long the position.

The current calculated beta is 0.98

CNBC:  Humana executives say Trump’s drug rebate proposal would raise premiums, restrict consumer choice

Fundamental Indicators:

Based on last reported financials, the company’s return on equity is 17.19%, return on assets is 6.54%, profit margin is 2.95%, price-to-sales is 0.72 and price-to-book is 3.99.

Company Scores:

All scores are out of six:
 0  :Valuation Score
 3  :Past Performance Score
 4  :Financial Strength Score
 3  :Future Growth Score
 0  :Dividend Score
 2  :Overall Score

John Jones
Worked for several Wall Street firms: Salomon Smith Barney, UBS, and Charles Schwab. Has developed skills and gained extensive experience over the years that is used today to uncover winning penny stocks.Also was an attorney for small businesses in Scottsdale, Arizona. That experience and understanding of law provides a unique perspective and edge in discovering quality companies in various industries.