Free Post Earnings Research Report: Humana Reported Better Than Expected Results
LONDON, UK / ACCESSWIRE / March 07, 2018 / Active-Investors.com has just released a free earnings report on Humana Inc. (NYSE: HUM). If you want access to this report all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=HUM. The Company reported its financial results on February 07, 2018, for the fourth quarter and for the full fiscal year ended December 31, 2017. The Company reported improvements in GAAP revenues, income from operations, and net income in Q4 FY17, but non-GAAP earnings declined y-o-y. Register today and get access to over 1000 Free Research Reports by joining our site below:
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Active-Investors.com is focused on giving you timely information and the inside line on companies that matter to you. This morning, Humana most recent news is on our radar and our team decided to put out a fantastic report on the company that is now available for free below:
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Earnings Highlights and Summary
For the fourth quarter of the fiscal year 2017, Humana's total revenues reached $13.19 billion, up 2.41% from $12.88 billion in Q4 FY16. The Company's services revenues increased 25.45% to $276 million y-o-y; its premium revenues advanced 2.1% to $12.82 billion y-o-y; while its investment income fell 9.18% to $89 million y-o-y in the reported quarter. The Company's total revenue numbers exceeded analysts' consensus estimates of $13.02 billion.
During Q4 FY17, Humana's total operating expenses were $12.62 billion, a decline of 5.2% from $13.32 billion in Q4 FY16. The Company's benefit ratio was 83% in Q4 FY17 compared to $89.2% in Q4 FY16. The Company's income from operations was $566 million for the quarter under review compared to a loss from operations of $438 million in the year ago same quarter.
Humana generated a net income of $184 million in Q4 FY17 compared to a net loss of $401 million in Q4 FY16. The Company's diluted earnings per share (EPS) were $1.29 in the reported quarter versus a diluted loss per share of $2.68 in the year earlier comparable quarter. Humana's reported quarter results included expenses related to terminated merger agreements, amortization cost of intangible assets, and charges associated with voluntary and involuntary workforce reduction programs, among few other special items. The results also included the impact of the US Tax Cuts and Jobs Act 2017 (TCJA), which were charges owing to a re‐measurement of deferred tax assets at a lower corporate tax rate, and a beneficial effect of the lower effective tax rate.
Humana's diluted EPS, after adjusting for non-recurring items, decreased 11.97% to $2.06 in Q4 FY17 from $2.34 in Q4 FY16. Humana's adjusted EPS were higher than analysts' consensus estimates of $2.00.
For the full fiscal year ended December 31, 2017, Humana's total revenues were $53.77 billion, a decrease of 1.13% from $54.38 billion in FY16. Humana's net income increased 298.7% to $2.45 billion in FY17 from $614 million in FY16. The Company's diluted EPS were $16.81 for the reported fiscal year, which is approximately 4.13 times the diluted EPS of $4.07 in the previous year. The Company's diluted EPS, excluding special items, were $11.71 in FY17, up 7.23% from $10.92 in FY16.
Segment Details
During Q4 2017, Humana's Retail segment's net revenues were $10.95 billion, up 3.03% y-o-y, primarily reflecting higher revenues associated with the Company's Medicare Advantage business. The segment's income from operations declined 8.43% to $391 million in Q4 FY17 from $427 million in Q4 FY16.
For Q4 FY17, Humana's Group and Specialty segment's net revenues advanced 2.94% to $1.89 billion on a y-o-y basis, led by higher performance incentives from the TRICARE contract, and an increase in fully‐insured group commercial medical per‐member premiums. The segment's income from operations was $47 million in Q4 FY17, which was almost 4.27 times the operating profit of $11 million in Q4 FY16.
During Q4 FY17, Humana's Healthcare Services segment's net revenues fell 5.79% to $6.02 billion on a y-o-y basis, mainly due to the Company's Pharmacy Solutions business and optimization process. The segment's income from operations was $213 million in the quarter under review, a decrease of 20.5% from $268 million in the year ago corresponding quarter.
For Q4 FY17, Humana's Individual Commercial segment's net revenues declined 27.3% to $194 million on a y-o-y basis. In the reported quarter, the segment's operating expenses shrank 76.9% to $208 million from $901 million in Q4 FY16. The segment incurred a loss from operations of $14 million in Q4 FY17 compared to a loss from operations of $634 million in Q4 FY16.
Cash Matters
Humana had cash and cash equivalents of $4.04 billion as on December 31, 2017, 4.26% higher than $3.88 billion as on December 31, 2016. The Company had a long-term debt of $4.77 billion as on December 31, 2017, compared to $3.79 billion as on December 31, 2016.
During Q4 FY17, Humana's net cash used in operating activities was $2.91 billion compared to a net cash outflow of $2.77 billion in Q4 FY16. The timing of the monthly premium remittances from CMS significantly impacted cash flows used in operations for both Q4 FY17 and Q4 FY16.
During the reported quarter, Humana spent $150 million on purchases of property and equipment. The Company issued net senior notes of $794 million and repaid long-term debt of $800 million in Q4 FY17. Humana spent $1.55 billion in common stock repurchases in Q4 FY17 compared to $29 million in Q4 FY16.
Outlook
For the full fiscal year 2018, Humana expects consolidated revenues to be between $55.8 billion and $56.4 billion. The Company expects its GAAP diluted EPS to be in the range of $13.16 to $13.66, and adjusted non-GAAP diluted EPS to be in the band of $13.50 – $14.00, including a net benefit from the TCJA of approximately $2.00 per share.
In February 2018, Humana's Board of Directors declared a cash dividend of $0.50 per share, payable on April 27, 2018, to stockholders of record as on March 30, 2018, which was an increase of 25% from the previous dividend of $0.40 per share.
Stock Performance Snapshot
March 06, 2018 - At Tuesday's closing bell, Humana's stock slightly rose 0.93%, ending the trading session at $273.11.
Volume traded for the day: 740.16 thousand shares.
Stock performance in the last three-month – up 5.64%; previous six-month period – up 5.55%; past twelve-month period – up 28.38%; and year-to-date – up 10.09%
After yesterday's close, Humana's market cap was at $39.01 billion.
Price to Earnings (P/E) ratio was at 15.51.
The stock has a dividend yield of 0.59%.
The stock is part of the Healthcare sector, categorized under the Health Care Plans industry.
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