Humana Profit Rises 34%

It guides above the consensus for 2006.
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Humana's

(HUM) - Get Report

fourth-quarter earnings rose 34% from a year ago on strong Medicare and government-segment underwriting results.

The company earned $64.6 million, or 39 cents a share, in the quarter, compared with $47.1 million, or 29 cents a share, a year ago. Adjusted for one-time expenses related to Hurricane Katrina, fourth-quarter earnings rose 59% to $77.3 million, or 46 cents a share, beating the Thomson First Call consensus estimate by a penny.

"Humana achieved record levels of revenue, net income and membership in 2005, as our Medicare business grew significantly and our commercial profits improved," Humana said. "But the real story of 2005 was our successful preparation for unprecedented Medicare expansion in 2006 and beyond. We are now superbly positioned to take advantage of this multi-year growth opportunity."

Humana bumped up guidance for 2006, saying it expects to earn at least $2.81 a share for the year, including 10 cents a share of stock options expense. Analysts were forecasting earnings of $2.74 a share for 2006.

The stock added 51 cents, or 0.9%, to $55.41 early Monday.