Opinions
Jim Cramer - Mad Money
Humana Inc
HUM-N
BUY ON WEAKNESS
Nov 08, 2023
$488.910
Stock price when the opinion was issued
medical services
It's the ideal tool to help you make quicker, more informed decisions for
managing and tracking your investments.
You might be interested:
BUY
Humana has gone from $420 to $500 in the past month. Healthcare stocks are climbing, but he prefers HC insurance than the drug companies, because their earnings are more predictable and trade a lot cheaper. 42% of Americans are obesity, so there's a lot of potential demand for these new, popular diet drugs. However, a lot of these people are also insured. Remember that the drugs space is competitive and eventually new drugs go generic. Insurance doesn't suffer that problem, and there isn't much variability in their earnings (they're more predictable). He also likes UNH.
medical services
Advertising
The markets has this wrong. They reported last week then shares tumbled more than 6% in a strong market week. He's taken profits on this but still owns many shares. Is beating the S&P since June. HUM actually reported a good quarter: strong earnings beat, 6% up YOY, sales up 18%. But shares came up way too high leading up to that report, so high expectations. Their benefits expense ratio came in lower than expected (good), but the core insurance segment ratio's was higher than expected. Also, their forecast suggests this ratio could go higher, due to a wave of Covid cases that hit sooner than they expected. Wall St. didn't like that HUM did not upgrade their full-year guidance. HUM projected slower, but more profitable growth. Run by good managers. Own for the long term.