Health insurer Humana Inc. ( NYSE: HUM ) added ~5% pre-market Thursday after the company revised its full-year 2022 guidance higher, ahead of its investor day, citing favorable trends in medical costs and the absence of COVID-related headwinds.
For 2022, HUM projects ~$23.08 of earnings per share on a reported basis and ~$25.00 adj. EPS, up from the previous guidance of ~$20.30 and ~$24.75, respectively.
The company attributed the decision to update adj. EPS guidance to lower-than-expected medical cost trends in its Medicare Advantage and Medicaid businesses and lack of COVID headwinds to date.
Noting that it will no longer add a separate item to reflect the COVID impact on full-year guidance, HUM has decided to remove the remaining $0.50 COVID headwind implied in its previous guidance for adj. EPS.
For 2025, the company projects its mid-term adj. EPS per diluted common share to reach $37.00, which indicates a 14% CAGR over the company’s new adj. EPS for 2022. HUM expects to meet or exceed that EPS growth forecast in 2026 and beyond.
The consensus for HUM shows $24.85 and $35.99 earnings per share for the company in 2022 and 2025, respectively.
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Humana gains after raising 2022 guidance ahead of investor day