Health insurance stocks including Humana (NYSE:HUM), CVS Health (NYSE: CVS), and UnitedHealth Group (NYSE: UNH) are trending upwards following a government announcement regarding increased payments to Medicare plan providers. Notably, Humana stock has demonstrated resilience in the face of ongoing trade war concerns, outperforming the broader market.
Considering these factors, our analysis indicates that Humana stock presents a compelling buying opportunity at its current price of approximately $290. We believe the stock is very attractive due to its current valuation, which appears particularly low when weighed against the company’s strong operating performance and solid financial condition. While there may be some minor concerns surrounding HUM, we believe these are more than offset by the significant undervaluation. However, for investors who seek lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 75% since its inception.
How Does Humana’s Valuation Look vs. The S&P 500?
Going by what you pay per dollar of sales or profit, HUM stock looks very cheap compared to the broader market.
- Humana has a price-to-sales (P/S) ratio of 0.3 vs. a figure of 3.2 for the S&P 500
How Have Humana’s Revenues Grown Over Recent Years?
Humana’s Revenues have seen notable growth over recent years.
- Humana has seen its top line grow at an average rate of 12.4% over the last 3 years (vs. increase of 6.3% for S&P 500)
- Its revenues have grown 10.7% from $106 Bil to $118 Bil in the last 12 months (vs. growth of 5.2% for S&P 500)
- Also, its quarterly revenues grew 10.4% to $29 Bil in the most recent quarter from $26 Bil a year ago (vs. 5.0% improvement for S&P 500)
How Profitable Is Humana?
Humana’s profit margins are considerably worse than most companies in the Trefis coverage universe.
Does Humana Look Financially Stable?
Humana’s balance sheet looks strong.
- Humana’s Debt figure was $12 Bil at the end of the most recent quarter, while its market capitalization is $31 Bil (as of 4/7/2025). This implies a moderate Debt-to-Equity Ratio of 36.8% (vs. 19.0% for S&P 500). [Note: A lower Debt-to-Equity Ratio is desirable]
- Cash (including cash equivalents) makes up $20 Bil of the $46 Bil in Total Assets for Humana. This yields a very strong Cash-to-Assets Ratio of 44.0% (vs. 14.8% for S&P 500)
How Resilient Is HUM Stock During A Downturn?
HUM stock has been more resilient than the benchmark S&P 500 index during some of the recent downturns. Worried about the impact of a market crash on HUM stock? Our dashboard How Low Can Humana Stock Go In A Market Crash? has a detailed analysis of how the stock performed during and after previous market crashes.
Inflation Shock (2022)
- HUM stock fell 22.9% from a high of $471.22 on 23 July 2021 to $363.17 on 7 January 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
- The stock fully recovered to its pre-Crisis peak by 1 July 2022
- Since then, the stock has increased to a high of $563.00 on 3 November 2022 and currently trades at around $290
Covid Pandemic (2020)
- HUM stock fell 43.6% from a high of $380.20 on 13 February 2020 to $214.43 on 23 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
- The stock fully recovered to its pre-Crisis peak by 30 April 2020
Global Financial Crisis (2008)
- HUM stock fell 78.4% from a high of $86.98 on 14 January 2008 to $18.77 on 5 March 2009, vs. a peak-to-trough decline of 56.8% for the S&P 500
- The stock fully recovered to its pre-Crisis peak by 7 November 2011
Putting All The Pieces Together: What It Means For HUM Stock
In summary, Humana’s performance across the parameters detailed above are as follows:
- Growth: Very Strong
- Profitability: Extremely Weak
- Financial Stability: Very Strong
- Downturn Resilience: Strong
- Overall: Good
The combination of the company’s solid performance in the analyzed parameters and its compellingly low valuation leads us to recommend HUM as a very good stock to buy.
While HUM stock looks promising, investing in a single stock can be risky. On the other hand, the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
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