Q3 2023 Earnings Summary
Reported on Nov 1, 2023 (Before Market Open)
Pre-Earnings Price$523.69Last close (Oct 31, 2023)
Post-Earnings Price$500.34Open (Nov 1, 2023)
Price Change
$-23.35(-4.46%)
- Humana expects to increase the number of contribution margin positive primary care centers from 110 at the end of 2022 to approximately 130 by the end of 2023, exceeding previous expectations and representing an 18% increase year-over-year.
- Humana anticipates future margin progression due to increased agent sales of about $250,000 for agents for the full year, with incremental benefits disproportionately weighted to year 3 when members fully convert to risk adjustment.
- Humana has completed approximately $1 billion in share repurchases to date and continues to anticipate share repurchases of approximately $1.5 billion in 2023, signaling confidence in the company's value and commitment to returning capital to shareholders.
- Higher-than-expected medical cost trends are leading to increased Medical Loss Ratios (MLRs), requiring additional mitigation efforts and potentially impacting profitability in 2024.
- Anticipated modestly higher attrition rates in 2024 due to benefit design changes and increased competition may negatively affect membership growth and revenue.
- New Medicare Advantage members are running higher MLRs than expected, partly due to a higher proportion of agent-sold plans which initially operate at 100% MLR, pressuring margins in the short term.
Research analysts covering HUMANA.