Core Insights - Simon and Humana have launched the Humana Walking Club to promote health and community engagement at 21 Simon centers across the U.S. [1][2] - The initiative aims to encourage physical activity through organized mall walks and challenges, with no participation cost, and events scheduled monthly before mall opening hours [2][4] - The program will run from August to December 2025, focusing on older adults and utilizing customized spaces and digital assets for enhanced engagement [3][4] Company Overview - Simon is a real estate investment trust (REIT) that owns premier shopping, dining, entertainment, and mixed-use destinations, recognized as an S&P 100 company [5] - Simon's properties generate billions in annual sales and serve as community gathering places for millions of people daily [5] - Humana is dedicated to prioritizing health through insurance and healthcare services, aiming to improve the quality of life for various demographics, including those with Medicare and Medicaid [6]

Core Viewpoint - Humana Inc. and DrFirst have launched a program aimed at improving medication therapy for patients with chronic conditions, particularly focusing on increasing statin therapy usage among eligible Medicare patients [1][2]. Group 1: Program Details - The program is designed to close care gaps for patients with chronic health conditions such as diabetes and cardiovascular disease [1]. - It utilizes the DrFirst prescription orchestration platform to facilitate timely prescription recommendations for high-risk patients, allowing healthcare providers to easily approve or decline these recommendations [2][3]. - The initiative aligns with quality metrics set by the Centers for Medicare & Medicaid Services (CMS) [1]. Group 2: Technology and Collaboration - The DrFirst platform enhances real-time interoperability among healthcare stakeholders, including providers, pharmacies, and payers, to improve patient outcomes [3][4]. - This partnership builds on a decade of collaboration between Humana and DrFirst, which includes the introduction of the first real-time prescription benefit tool in 2015 [5]. Group 3: Company Backgrounds - Humana Inc. focuses on health and well-being, providing services to various demographics, including Medicare and Medicaid recipients [6]. - DrFirst has been a pioneer in healthcare IT for 25 years, offering intelligent medication management solutions that enhance prescription access and adherence [7].

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores are designed to help investors identify stocks with the highest potential to outperform the market in the short term [2] Zacks Style Scores Overview - The Style Scores categorize stocks into four main types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] - Value Score emphasizes finding undervalued stocks based on financial ratios [3] - Growth Score focuses on a company's financial health and future growth potential [4] - Momentum Score capitalizes on existing trends in stock prices and earnings [5] - VGM Score combines the strengths of all three Style Scores to identify the most attractive investment opportunities [6] Zacks Rank and Performance - The Zacks Rank is a proprietary model that uses earnings estimate revisions to assist in stock selection [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +23.75% since 1988, significantly outperforming the S&P 500 [8] - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal returns [9] Stock Example: Humana Inc. (HUM) - Humana Inc. is a major health care plan provider in the U.S., offering various health insurance products [11] - Currently rated 3 (Hold) by Zacks, Humana has a VGM Score of A and a Value Style Score of A, indicating strong valuation metrics [12] - Recent analyst revisions have increased Humana's earnings estimate for fiscal 2025, with a consensus estimate of $16.93 per share and an average earnings surprise of +9.6% [12] - Given its solid Zacks Rank and favorable Style Scores, Humana is recommended for investors' consideration [13]

Company Overview - Humana Inc. is one of the largest health care plan providers in the United States, founded in 1964 and headquartered in Louisville, KY [11] - The company offers health insurance benefits through various plans including Health Maintenance Organization (HMO), Private Fee-For-Service (PFFS), and Preferred Provider Organization (PPO) plans, along with specialty products like dental and vision benefits [11] Investment Ratings - Humana is currently rated as 3 (Hold) on the Zacks Rank, with a VGM Score of A, indicating a solid overall performance [12] - The company has a Momentum Style Score of A, with shares increasing by 4.3% over the past four weeks [12] Earnings Estimates - Six analysts have revised their earnings estimates higher for fiscal 2025, with the Zacks Consensus Estimate increasing by $0.30 to $16.67 per share [12] - Humana has an average earnings surprise of +9.6%, suggesting a positive trend in earnings performance [12] Investment Consideration - With a strong Zacks Rank and top-tier Momentum and VGM Style Scores, Humana is recommended for investors looking for potential opportunities in the healthcare sector [13]

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Humana Inc. due to a class action lawsuit alleging breaches of fiduciary duties by the board of directors during the specified class period [2][4]. Group 1: Class Action Lawsuit Details - The class action lawsuit against Humana alleges that the company made false or misleading statements regarding its adjusted earnings-per-share, particularly downplaying the impact of increased medical costs from pent-up demand for healthcare services [4]. - On June 13, 2023, UnitedHealth Group Inc. reported higher outpatient care activity, which led to a significant drop of over 11% in Humana's stock price [5]. - Following a report on June 16, 2023, indicating higher than anticipated non-inpatient utilization trends, Humana's stock price fell again, reflecting investor concerns [6]. - On January 18, 2024, Humana disclosed an increase in its benefits expense ratio to approximately 91.4% for Q4 2023, resulting in a nearly 8% decline in stock price [7]. - The announcement of a loss of $4.42 per share for Q4 2023 on January 25, 2024, due to higher inpatient utilization and expected persistent medical costs, caused Humana's stock to drop nearly 12% [8]. Group 2: Company Overview - Humana is a health insurance company that provides medical benefit plans to its members [3].

Humana Wednesday reported $545 million in second quarter profits as the health insurer’s medical cost trends fell in line with expectations. https://t.co/MOlXO6wJQX https://t.co/MOlXO6wJQX ...

Financial Performance - For the three months ended June 30, 2025, net income attributable to Humana was $545 million, or $4.51 per diluted common share, compared to $679 million, or $5.62 per diluted common share for the same period in 2024[136]. - The consolidated income before income taxes for the three months ended June 30, 2025, was $261 million, significantly up from $136 million in the same period of 2024[135]. - Consolidated premiums revenue increased by $2.6 billion, or 9.1%, from $28.1 billion in Q2 2024 to $30.7 billion in Q2 2025, and by $4.8 billion, or 8.6%, from $56.4 billion in the first half of 2024 to $61.2 billion in 2025[144]. - Consolidated services revenue rose by $0.3 billion, or 27.3%, from $1.1 billion in Q2 2024 to $1.4 billion in Q2 2025, and by $0.6 billion, or 26.5%, from $2.2 billion in the first half of 2024 to $2.7 billion in 2025[145]. - Investment income decreased by $26 million, or 8.7%, from $298 million in Q2 2024 to $272 million in Q2 2025, and by $50 million, or 8.5%, from $586 million in the first half of 2024 to $536 million in 2025[146]. - Consolidated benefits expense increased by $2.5 billion, or 10.1%, from $25.0 billion in Q2 2024 to $27.6 billion in Q2 2025, and by $3.9 billion, or 7.8%, from $50.2 billion in the first half of 2024 to $54.1 billion in 2025[147]. - The consolidated benefit ratio increased by 70 basis points from 89.0% in Q2 2024 to 89.7% in Q2 2025, reflecting a shift in business mix[147]. - Consolidated operating costs rose by $0.4 billion, or 12.7%, from $3.1 billion in Q2 2024 to $3.5 billion in Q2 2025, and by $0.7 billion, or 11.9%, from $6.2 billion in the first half of 2024 to $6.9 billion in 2025[150]. - The effective income tax rate was 24.7% for Q2 2025, unchanged from Q2 2024, while it decreased from 25.0% in the first half of 2024 to 24.6% in 2025[153]. Membership and Market Trends - Approximately 3,542,300 members, or 68%, of individual Medicare Advantage members were in value-based relationships as of June 30, 2025, down from 70% in June 2024[136]. - Total Medicare membership decreased by 277,300, or 3.3%, from 8,503,700 in June 2024 to 8,226,400 in June 2025[154]. - Individual Medicare Advantage membership declined by 388,300, or 6.9%, from 5,617,600 in June 2024 to 5,229,300 in June 2025[154]. - Group Medicare Advantage membership increased by 25,100 members, or 4.6%, from June 30, 2024, to June 30, 2025[158]. - State-based contracts and other membership increased by 190,600 members, or 13.7%, from June 30, 2024, to June 30, 2025[159]. - Individual Medicare Advantage membership decreased by 388,300 members, or 6.9%, from June 30, 2024, to June 30, 2025, including a net decrease of 166,800 D-SNP members, or 17.5%[157]. Operational Changes and Initiatives - The company recorded impairment charges of $32 million for the three months ended June 30, 2025, compared to no impairment charges in the same period of 2024[128]. - Total charges related to value creation initiatives were $29 million for the three months ended June 30, 2025, compared to $68 million for the same period in 2024[127]. - The operating cost ratio is impacted by costs incurred in the second half of the year associated with the Medicare marketing season[133]. - The company expects to incur additional charges in 2025 related to cost-saving and productivity initiatives[127]. - Regulatory changes, including those from the Inflation Reduction Act, may materially affect Humana's results of operations and financial position[138]. - The Medicare Part D coverage gap was eliminated effective January 1, 2025, which is expected to reduce out-of-pocket costs for beneficiaries[133]. Segment Performance - CenterWell segment total revenues increased by $590 million, or 11.9%, from $4.9 billion in Q2 2024 to $5.5 billion in Q2 2025[165]. - CenterWell services revenue increased by $0.3 billion, or 34.8%, from $0.9 billion in Q2 2024 to $1.2 billion in Q2 2025[167]. - Income from operations for the Insurance segment increased by $3 million, or 0.4%, from $763 million in Q2 2024 to $766 million in Q2 2025, and increased by $679 million, or 40.9%, from $1.7 billion in the first half of 2024 to $2.3 billion in 2025[156]. - The Insurance segment benefit ratio increased by 40 basis points from 89.5% in Q2 2024 to 89.9% in Q2 2025[163]. - The CenterWell segment operating cost ratio increased by 70 basis points from 92.0% in Q2 2024 to 92.7% in Q2 2025[169]. - The Insurance segment operating cost ratio decreased by 10 basis points from 8.4% in Q2 2024 to 8.3% in Q2 2025[164]. Cash Flow and Capital Management - Cash and cash equivalents increased to approximately $4.0 billion at June 30, 2025, up from $2.2 billion at December 31, 2024, reflecting a net increase of $1.819 billion for the six months ended June 30, 2025[171]. - Total net receivables rose to $4.504 billion at June 30, 2025, compared to $2.704 billion at December 31, 2024, marking an increase of $1.800 billion[174]. - Medicare receivables increased by $1.963 billion in the 2025 period, driven by higher per member Medicare premiums due to an increased direct subsidy from the IRA[174]. - Total net capital expenditures, excluding acquisitions, were $209 million in the 2025 period, down from $291 million in the 2024 period[176]. - Net proceeds from investment securities were $871 million in the 2025 period, compared to net purchases of $1.1 billion in the 2024 period[177]. - Claim payments exceeded receipts from CMS associated with Medicare Part D claim subsidies by $482 million in the 2025 period[178]. - The company repurchased common shares for $100 million in the 2025 period, down from $750 million in the 2024 period[185]. - The amount of ordinary dividends paid to the parent company was approximately $0.3 billion during the six months ended June 30, 2025, compared to $0.5 billion in the same period of 2024[195]. - The average duration of the investment portfolio was approximately 3.6 years as of June 30, 2025, indicating sensitivity to interest rate changes[199]. - The company maintained aggregate statutory capital and surplus of approximately $14.5 billion, exceeding the minimum regulatory requirements of $10.9 billion[195].

Core Insights - Humana Inc. reported second-quarter 2025 adjusted earnings of $6.27 per share, missing the Zacks Consensus Estimate by 0.8%, and a year-over-year decrease of 9.9% [1] - Adjusted revenues reached $32.4 billion, reflecting a 10.2% year-over-year increase, surpassing the consensus mark by 1.9% [1] Financial Performance - The quarterly results were negatively impacted by elevated expense levels and a decline in individual Medicare Advantage membership, although this was partially offset by strong performance in the CenterWell unit [2] - Premiums improved by 9.1% year over year to $30.7 billion, exceeding the Zacks Consensus Estimate of $30.2 billion [3] - Services revenues climbed 27.3% year over year to $1.4 billion, beating the consensus mark of $1.31 billion [3] - Total operating expenses increased by 10.2% year over year to $31.3 billion, higher than the estimate of $29.9 billion, driven by higher benefits and operating costs [5] Segment Performance - The Insurance segment recorded adjusted revenues of $31.1 billion, up 9.6% year over year, due to improved per-member Medicare premiums and an expanding customer base [6] - CenterWell revenues advanced 11.9% year over year to $5.5 billion, benefiting from higher revenues in pharmacy and primary care businesses [8] Membership and Ratios - Total medical membership in the Insurance segment was 14.8 million, down 9% year over year, falling short of the Zacks Consensus Estimate of 15.4 million [7] - The benefit ratio deteriorated by 70 basis points year over year to 89.7%, influenced by state-based contracts and a decline in individual Medicare Advantage membership [4] Cash Flow and Capital Deployment - Humana ended the second quarter with cash and cash equivalents of $4 billion, an increase of 81.9% from the end of 2024 [11] - The company generated net cash from operations of $1.6 billion in the first half of 2025, a decrease of 2.1% from the prior year [12] - Share buybacks amounted to $109 million in the first half of 2025, with dividends paid totaling $214 million [13] 2025 Outlook - Adjusted EPS is now forecasted at around $17.00, up from the previous estimate of $16.25, indicating a 4.9% rise from 2024 [14] - Revenues are estimated to be at least $128 billion, reflecting an 8.7% increase from 2024 [15] - Individual Medicare Advantage membership is expected to decline by up to 500,000 in 2025 [16]

Core Insights - Humana reported $32.39 billion in revenue for the quarter ended June 2025, a year-over-year increase of 10.2% [1] - The EPS for the same period was $6.27, down from $6.96 a year ago, with a surprise of -0.79% compared to the consensus estimate of $6.32 [1] Financial Performance - The reported revenue exceeded the Zacks Consensus Estimate of $31.78 billion by 1.93% [1] - The Benefits Expense Ratio was 89.7%, slightly above the average estimate of 89.5% [4] - Medical Membership in Medicare Supplement reached 444.1 thousand, surpassing the estimate of 419.63 thousand [4] - Total Medicare Medical Membership was 8.23 million, slightly above the average estimate of 8.19 million [4] - Premium revenues were $30.72 billion, exceeding the estimate of $30.23 billion, representing a 9.2% increase year-over-year [4] - Investment income was reported at $272 million, a decrease of 8.7% year-over-year [4] - Services revenue was $1.4 billion, exceeding the estimate of $1.31 billion, reflecting a 27.3% year-over-year increase [4] - Revenue from the CenterWell segment was $5.54 billion, above the estimate of $5.21 billion, with an 11.9% year-over-year change [4] - Total Intersegment Revenues showed a change of +6.9% year-over-year, reported at -$4.34 billion compared to the estimate of -$4.18 billion [4] Stock Performance - Humana's shares have returned -7.9% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3]

Financial Data and Key Metrics Changes - The company raised its full year 2025 EPS outlook from approximately $16.25 to approximately $17, driven by strong performance in CenterWell Pharmacy and better than expected individual MA membership [8][21] - Medical cost trends for the second quarter were in line with expectations, with overall medical and operating costs trending in line or better than expected [21][28] Business Line Data and Key Metrics Changes - Individual MA membership declined less than expected, with a guidance adjustment now assuming a decline of around 500,000 members compared to the previous estimate of 550,000 [9][28] - CenterWell Pharmacy outperformed expectations due to higher direct-to-consumer volume and favorable specialty pharmacy dynamics [19][62] Market Data and Key Metrics Changes - The company is expanding its Medicaid footprint, now active in 10 states with three more states pending, and is optimistic about its performance in the LTSS population [18][32] - The company noted that its Medicaid performance is not directly comparable to peers due to differences in product focus and state footprints [30][32] Company Strategy and Development Direction - The company is focused on enhancing member experience through initiatives like simplifying prior authorization processes and integrating health plan information into MyChart [11][12] - A multi-year transformation is underway to create a more efficient back office, including early retirement programs and outsourcing shared services [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the core fundamentals and growth outlook for MA, believing it will deliver compelling shareholder value over the long term [20] - The company is making incremental investments of approximately $100 million to improve member outcomes and operational excellence [21][67] Other Important Information - The company is committed to maximizing shareholder value through share buybacks and prudent capital deployment strategies [22][23] - The company is monitoring the impact of recent CMS regulations and IRA changes on its Part D performance and overall strategy [36][39] Q&A Session Summary Question: Cost trends and Medicaid performance - Management indicated that overall medical and operating costs are trending in line with expectations, with Medicaid performing as anticipated [26][28][33] Question: Part D performance and CMS regulations - Part D member mix and Rx trends are tracking in line with expectations, with no unexpected behavioral changes noted [35][36] Question: Individual PPO market implications - Management believes that product and benefit structure improvements will mitigate risks associated with membership growth and margins [42][45] Question: Inpatient utilization trends in Medicare Advantage - Inpatient utilization is trending in line with expectations, with no acceleration noted [52][53] Question: Updates on STARS performance - Management is confident in operational progress and expects improvement in underlying metrics, though specific data is not available yet [56][59] Question: Specialty pharmacy strength and IRA dynamics - Specialty pharmacy outperformance is attributed to strategic partnerships and broader industry trends, with no unexpected behavioral changes in Part D noted [62][65] Question: Incremental investments and guidance - Management confirmed an additional $100 million in incremental investments aimed at driving returns and supporting transformation efforts [67][68] Question: Membership growth and operational absorption - Management is confident in the product and believes operational absorption of growth will be manageable, with a focus on long-term value [110][111]