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Humana Tops Q4 Profit Forecast, Sees PDP Membership Declines

Humana said it sees 2020 earnings in the region of $18.25 to $18.75 per share after topping Wall Street's fourth quarter profit forecasts.

Humana Inc.  (HUM) - Get Free Report posted stronger-than-expected fourth quarter earnings Wednesday, and forecast solid 2020 profits, sending shares in the heathcare insurance provider higher in pre-market trading.

Humana said adjusted earnings for the three months ending in December were pegged at $2.28 per share, down 14% from the same period last year but 8 cents ahead of the Street consensus forecast. Group revenues, Humana said, rose 15.1% to $16.3 billion, again topping analysts' forecasts of a $16.2 billion tally.

Looking into 2020, Humana said it sees adjusted earnings in the region of $18.25 to $18.75 per share, compared to a Refinitiv forecast of $18.63 per share, but noted that membership to its Preferred Rx Plan (PDP) could decline by as much as 550,000.

 "We are pleased with our 2019 performance, particularly our success in balancing and executing on multiple priorities as we grew membership, improved the quality and productivity of our operations, and continued to invest in the long-term," said CEO Bruce Broussard. "You’ll find evidence of these efforts in our improved Net Promoter Score - and in the related, and numerous, awards we received for customer experience." 

"In addition, we had strong membership growth, with a record number of our members now in 4+ Star Plans," he added. "All the while, we made appreciable progress in advancing our technology, primary care and home strategies."  

Humana shares were marked 4.6% higher in early Wednesday trading following the earnings release to change hands at $359.00 each, extending their six-month gain to around 25.22%.