Humana Reports Inline Q4 But Issues Strong Guidance

Humana Inc HUM reported its fourth quarter results Wednesday morning. The company earned $1.45 per share on revenue of $13.40 billion. Wall Street analysts were expecting the company to earn $1.45 per share on revenue of $13.50 billion.

Humana recorded an Adjusted non-GAAP income of $431 million in the quarter, marking a strong increase from $324 million a year ago. The company noted the strong quarterly income reflected higher operating results from the Group and Healthcare Services segments and higher investment income associated with the repositioning of its investment portfolio in fiscal 2015.

"Our commitment to our integrated care delivery strategy is strong," said Bruce D. Broussard, Humana's President and Chief Executive Officer. "That commitment combined with the operational corrections we made in 2015 provides us a solid trajectory to achieve our target margins for each of our businesses over time, including 4.5 to 5 percent for individual Medicare Advantage. We will continue to balance our business segment margins with the growth in our Healthcare Services businesses to engage our members and drive quality outcomes, resulting in the greatest enterprise value. Further, we are pleased with progress to date on the pending transaction with Aetna and continue to expect it to close in the latter half of 2016."

Looking forward to the full year fiscal 2016, Humana guided its earnings per share to be $8.85, which is higher than the $8.73 per share Wall Street analysts were already projecting.