Wedbush Securities Reiterates Outperform Rating, $102 PT on Humana

In a report published Wednesday, Wedbush Securities reiterated its Outperform rating and $102.00 price target on Humana

. Wedbush Securities noted, “Budget headwinds could weigh on the group through year end, but ultimately we believe volume growth outweighs rate risks. The group historically comes under pressure in times of regulatory uncertainty, we view the grand bargain budget scenario as presenting more uncertainty than sequestration, but view both as manageable risks from an operational standpoint. We believe Humana has several levers to pull to maintain 5% margins in the face of rate pressure, but even under a bear-case (an unlikely in our opinion) 3% margin scenario we believe volume growth will more than outweigh the margin compression by 2015.” Humana closed on Tuesday at $68.29.