Zacks Investment Research upgraded shares of Humana Inc. (HUM) from UNDERPERFORM to NEUTRAL on November 27, 2012, with a target price of $69.00.
We are upgrading our recommendation on Humana to Neutral on the back its strategic acquisitions and alliances that are enhancing membership, earnings and Medicare coverage. Improved 2012 earnings guidance also provides optimism. Strong financials and sturdy ratings are the other positives. Humana's third quarter earnings surpassed the Zacks Consensus Estimate but lagged the year-ago results due to lower income in the Retail and Employer Group segments, partially offset by higher earnings from Health and Well-Being Services. Improved memberships led to revenue growth, offset by higher expenses and benefit ratio. Humana's dependence on Medicare Advantage plans, rising expenses, adverse impact of healthcare reform and high competition raise concerns. Overall, we believe the company needs to follow prudent expense management and focus on growth through acquisitions and diversifying its earning sources to attract long-term investors.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
To get a free copy of the research report on Humana Inc. (HUM),
click here.
For more information about research offerings from Zacks Investment Research, visit
Zacks.com .
Be the first to comment