Wedbush Raises PT To $79 On HUM

Wedbush has raised its price target from $71 to $79 on Humana Inc. HUM and reiterates its Outperform rating. In the report, Wedbush writes, “Our Increased Estimates Are Based on Updated MA and PDP Enrollment Data That Exceeded our Expectations. We also continue to believe that utilization trends will remain moderate in 1Q11; this is supported by recent channel checks… We believe Humana's multiple of 8.9x does not fully reflect the true earnings potential. Our new PT represents a 11.4x multiple of our 2011 estimate of $6.58 — we view the LT growth potential for Medicare as undervalued and see tailwinds for the group in 2011 that could lead to multiple expansion.” HUM closed yesterday at $69.29.