Humana Has A 'Positive 6-Month Catalyst Path,' Says Bullish Analyst

Humana Inc HUM recently inked an in-network deal with the University of Alabama at Birmingham's (UAB) Health System to provide Medicare Advantage members in the state greater access to care.

The leadership of the new CEO, Jim Rechtin, who is joining on July 1, could accelerate the company's turnaround, according to Piper Sandler.

The Humana Analyst: Jessica Tassan initiated coverage of Humana with an Overweight rating and price target of $392.

The Humana Thesis: The company's turnaround is "well underway," and earnings are likely to trough this year, Tassan said in the initiation note.

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Humana has a "positive 6-month catalyst path," starting with the raising of its 2024 adjusted earnings guidance as early as during the second-quarter earnings call, she stated.

"We believe the company's purpose-built healthcare delivery and services infrastructure should improve outcomes and bend the cost curve through center-based, at-home and pharmacy care over time," the analyst wrote.

"In public appearances since the 1Q24 print, HUM management has stated that inpatient admissions are trending in line with expectations but that unit costs could be favorable," she further said.

HUM Price Action: Shares of Humana had risen by 1.30% to $360.42 at the time of publication on Wednesday.

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