Humana Q3 Profit Tops View, Backs FY Forecast

(RTTNews) - Health insurer Humana Inc. (HUM) Friday reported increased profit for the third quarter, as revenues climbed more than 9 percent from last year. Adjusted earnings topped Wall Street estimates, while revenues came short of expectations.

Bruce Broussard, Humana's President and CEO, said, "Our third quarter results included operating performance for our Medicare businesses that was generally in line with our expectations and continuing momentum in our Healthcare Services segment, but were challenged by our individual commercial business."

Net income for the quarter advanced to $314 million from $290 million reported last year. Earnings per common share rose to $2.09 from $1.85 for the quarter ended September 30, 2014.

Adjusted earnings per share were $2.16, while it totaled $1.85 last year. On average, 20 analysts polled by Thomson Reuters expected earnings of $2.13 per share for the quarter. Analysts' estimates typically exclude special items.

Consolidated revenues rose 9.2 percent to $13.36 billion from $12.24 billion in the previous year. Analysts expected revenues of $13.64 billion.

Revenue from Premiums climbed 11.9 percent to $13 billion. According to the company, the year-over-year increase in premiums and services revenues primarily reflected higher Retail and Group segment totals.

Humana has entered into a definitive merger agreement with Aetna Inc. for Aetna to acquire each outstanding common share of Humana for $125 in cash and 0.8375 of an Aetna common share. Humana today said it expects the transaction to close in the second half of 2016.

The company reaffirmed its adjusted earnings per share guidance for the year ending December 31, 2015 of $7.75. Analysts look for earnings of $7.76 per share.

HUM closed up 1.2 percent on Thursday at $179.05.