Humana Inc (HUM)
Official siteHEALTHCARE • HEALTHCARE PLANS • NYSE
Market Cap: $46.30B
Last updated: Sep 01, 2026 at 10:00 AM ET
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I Tested One Of Wall Street’s Favorite AI Trades - It Failed
Travelers Q2 core income $10.04 vs $5.41 consensus, stock +10%; CEO credited AI for a 0.5 percentage-point improvement in underlying loss ratio while expense ratio rose to 29%. Wall Street thesis posits AI cuts SG&A to create EPS torque in low-margin giants - e.g., CVS 0.4% net margin on $402bn revenue, $45bn SG&A, a 3% SG&A cut modeled to lift GAAP EPS $1.36 to $2.17 (60%). GAAP EPS torque is often an artifact of writedowns, not pure operating leverage. Most SG&A is hourly store labor and not addressable by LLMs - Kroger's $28bn OG&A is dominated by store jobs, a 3% cut implies roughly 12,000 roles and multi-year capex, not immediate automated savings. Regulated payers tend to pass admin savings back via bids - Medicaid and Medicare Advantage reprice to observed costs; by contrast loss-ratio gains stick.
Health Insurer Stocks: Recent Crash is Likely An Attractive Buffett Style "Fat Pitch" Opportunity
Monday Jan 27th was "The Monday night massacre" when Medicare announced a 0.7% increase in reimbursement rates for 2026. 5% to 6% was the consensus and health insurance companies fell between 8% and 20% in overnight trading. Only Humana has continued to decline (-26% so far) but Morningstar (and I) agree that even a one year change in reimbursment shouldn't significantly change any fair value PEs or long-term growth rates. UNH and CVS are trading near historical fair value, with UNH offering the best long-term growth potential (3% yield and about 20% CAGR returns over 5 years). ELV is trading at a modest historical discount with management guiding for strong growth despite this Medicare headwind. HUM is trading at 11X earnings, a nearly 50% historical discount with up to 5X return potential in the next 4 to 5 years (Morningstar is even more optimistic). Just remember that the biggest risk is that health insurance inflation (about 300% over 20 years) is becoming a hot button topic for both political parties, so political headline risk like this might become more common. For the medium-term (3 to 5 years) the health insurance industry is likely to see double-digit EPS growth.
3 Ways Your Family Can Thrive In The Age Of AI
The Age of AI is simultaneously terrifying, thrilling, terrible, delightful, and full of wonders. To keep your family safe, sane, and prosperous requires a humble appreciation that the world is more complex than any human can imagine, and change is only going to keep accelerating. Contradictory facts can (and usually are) true in this complex world, and the details are often the difference between success and failure, between retiring in comfort, in splendor, or not at all. Compassion for those whose lived experiences are different than the statistical data is important to follow the excellent advice of "Act justly, love mercy, and walk humbly" At the same time, only discplined financial scientist investors, whose facts and reasoning are right, are going to thrive, and help their families thrive by accruing assets, which are the currency of the future. Asset based living is what will seperate those who live in a Star Trek utopia, and those who live in a Westeros like feudal society where they feel trapped and desperate. I am so excited to be able to help build a company that can guide wonderful people through this terrible yet delightfully wonderous period of history! It's an honor to be on this journey with all of you right now! NVDA, HUM, and BAM are the stocks ZEUS bought today during the silly freakout over the Fed MAYBE not cutting in Dec. Earnings growth is 15%, the economy is strong, and Olive Garden awaits😉🤣😂🤗
Government Contracts
Federal contract obligations are bookings recorded by the awarding agency, not recognized revenue. They can exceed 100% of revenue and can be negative when contracts are de-obligated. Source: USAspending.gov prime awards, data through Jul 31, 2026.
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Frequently Asked Questions About HUM
- What is HUM's current dividend yield?
- Humana Inc (HUM) has a current dividend yield of 0.92%.
- Does HUM pay dividends?
- Yes, Humana Inc pays dividends with a current yield of 0.92%.
- What is HUM's P/E ratio?
- Humana Inc has a price-to-earnings (P/E) ratio of 22.30.
- What is HUM's market cap?
- Humana Inc (HUM) has a market capitalization of $46.30B with a current stock price of $383.50.
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