Humana Guides FY2026 EPS at $9 vs $12 Estimate, Shares Hit 52-Week Low
Humana posted a Q4 adjusted loss of $3.96 per share versus consensus of $4.00 and revenue of $32.52 billion versus $32.04 billion, with a GAAP benefit ratio of 90.4%. The company guided 2026 adjusted EPS at at least $9.00, below the $12.00 analyst forecast, citing a Star Ratings headwind despite projected 25% Medicare Advantage membership growth.
1. Q4 Results Exceed Estimates
Humana reported an adjusted net loss of $3.96 per share for Q4 2025, slightly better than the $4.00 consensus, and revenue of $32.52 billion, topping the $32.04 billion estimate. The Insurance segment’s GAAP benefit ratio was 90.4%, at the top end of its guided 90.1%–90.5% range.
2. Disappointing 2026 Guidance
The company projected 2026 adjusted EPS of at least $9.00, well below the $12.00 Wall Street estimate, triggering a more than 2% intra-day share decline and a new 52-week low. Management attributed the shortfall to headwinds and conservative planning for the upcoming bonus year.
3. Star Ratings Impact and Mitigation
Humana cited a significant Star Ratings headwind for Bonus Year 2026 as the primary drag on earnings, partly offset by mitigation efforts in plan design and operational enhancements. These ratings adjustments are expected to pressure margins before remedial actions fully take effect.
4. Membership Growth and Platform Expansion
Despite the softer outlook, Humana forecasts approximately 25% growth in individual Medicare Advantage membership for 2026, driven by new enrollments and improved retention strategies. The CenterWell senior care platform also expanded, registering a 25% increase in primary care patients during 2025.