Humana Inc.
Humana Inc. Fundamental Analysis
Humana Inc. (HUM) shows weak financial fundamentals with a PE ratio of 32.59, profit margin of 0.82%, and ROE of 6.19%. The company generates $136.9B in annual revenue with strong year-over-year growth of 10.06%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 50.7/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze HUM's fundamental strength across five key dimensions:
Efficiency Score
WeakHUM struggles to generate sufficient returns from assets.
Valuation Score
ModerateHUM shows balanced valuation metrics.
Growth Score
ModerateHUM shows steady but slowing expansion.
Financial Health Score
ExcellentHUM maintains a strong and stable balance sheet.
Profitability Score
WeakHUM struggles to sustain strong margins.
Key Financial Metrics
Is HUM Expensive or Cheap?
P/E Ratio
HUM trades at 32.59 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, HUM's PEG of -0.96 indicates potential undervaluation.
Price to Book
The market values Humana Inc. at 1.98 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 9.72 times EBITDA. This is generally considered low.
How Well Does HUM Make Money?
Net Profit Margin
For every $100 in sales, Humana Inc. keeps $0.82 as profit after all expenses.
Operating Margin
Core operations generate 1.01 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $6.19 in profit for every $100 of shareholder equity.
ROA
Humana Inc. generates $2.04 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Humana Inc. generates limited operating cash flow of $1.84B, signaling weaker underlying cash strength.
Free Cash Flow
Humana Inc. generates weak or negative free cash flow of $1.27B, restricting financial flexibility.
FCF Per Share
Each share generates $10.57 in free cash annually.
FCF Yield
HUM converts 3.47% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
32.59
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.96
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.98
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.27
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.75
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.26
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.06
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.04
vs 25 benchmark
How HUM Stacks Against Its Sector Peers
| Metric | HUM Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 32.59 | 28.62 | Worse (Expensive) |
| ROE | 6.19% | 788.00% | Weak |
| Net Margin | 0.82% | -48085.00% (disorted) | Weak |
| Debt/Equity | 0.75 | 0.39 | Weak (High Leverage) |
| Current Ratio | 1.26 | 4.11 | Neutral |
| ROA | 2.04% | -21875.00% (disorted) | Weak |
HUM outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Humana Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
84.36%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
-61.28%
Industry Style: Defensive, Growth, Innovation
DecliningFCF CAGR
-82.07%
Industry Style: Defensive, Growth, Innovation
Declining