Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
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Highlights from the ratings report include:
- HUM's revenue growth trails the industry average of 14.4%. Since the same quarter one year prior, revenues slightly increased by 3.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- HUM's debt-to-equity ratio is very low at 0.19 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, HUM has a quick ratio of 1.58, which demonstrates the ability of the company to cover short-term liquidity needs.
- HUMANA INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, HUMANA INC increased its bottom line by earning $8.44 versus $6.47 in the prior year. For the next year, the market is expecting a contraction of 11.3% in earnings ($7.49 versus $8.44).
- The change in net income from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Health Care Providers & Services industry average. The net income has decreased by 4.2% when compared to the same quarter one year ago, dropping from $444.76 million to $426.00 million.
Humana Inc. operates as a health care company that offers a range of insurance products and health and wellness services that incorporate an integrated approach to lifelong well-being. Humana has a market cap of $10.57 billion and is part of the health care sector and health services industry. The company has a P/E ratio of 8.9, below the S&P 500 P/E ratio of 17.7. Shares are down 23.8% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.
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