Can Humana Beat Q2 Earnings Estimates on Insurance Unit Strength?

Core Insights - Humana Inc. (HUM) is expected to report second-quarter 2025 results on July 30, with earnings estimated at $6.32 per share and revenues at $31.78 billion, reflecting an 8.2% year-over-year growth in revenues despite a 9.2% decline in earnings [2][6] Financial Performance Expectations - The full-year 2025 revenue estimate for Humana is $126.1 billion, indicating a 7.6% year-over-year increase, while the EPS for the current year is projected at $16.37, showing a 1% gain year-over-year [3] - Humana has consistently beaten earnings estimates in the past four quarters, with an average surprise of 14.3% [3] Earnings Prediction Model - The company has a positive Earnings ESP of +10.51% and a Zacks Rank of 3 (Hold), suggesting a likelihood of an earnings beat this quarter [4] Revenue and Income Growth - The consensus estimate for second-quarter premiums indicates a 7.4% increase year-over-year, with total Medicare expected to grow by 3.8% [7] - Operating income from the Insurance unit is projected to grow by 21.4% compared to the previous year, contributing positively to earnings [8] Cost and Membership Challenges - The CenterWell unit is expected to see a 0.4% decline in operating income, and investment income is projected to drop nearly 9% year-over-year [9] - Total operating costs are anticipated to exceed $30 billion, increasing by more than 5%, which may negatively impact the bottom line [9] - The overall benefits expense ratio is expected to worsen to 89.47%, and insurance membership is projected to decline by 5.8% year-over-year [10] Peer Performance Comparison - Centene Corporation reported a second-quarter adjusted loss per share of 16 cents, missing estimates due to rising medical costs and declining service revenues [11] - Molina Healthcare reported adjusted EPS of $5.48, slightly missing estimates due to higher medical care costs [12] - Elevance Health reported adjusted EPS of $8.84, also missing estimates due to rising medical costs, despite some offset from increasing premiums [12]