NYSE$HUM

Humana Inc · Q1 2022 earnings

Q1 2022 earnings · · Investor relations

Briefing

Humana's Q1 2022 financial results were reported, and the full year 2022 adjusted EPS financial guidance was raised.

Humana reported a strong start to the year with all business lines performing well. The company raised its full year Adjusted EPS guidance to approximately $24.50, representing 19 percent growth over the actual 2021 results. Humana is also making progress in improving Medicare Advantage membership growth in 2023.

  • Reported 1Q22 earnings per diluted common share of $7.29 on a GAAP basis and Adjusted EPS of $8.04.
  • Updated FY 2022 EPS guidance to approximately $22.98 on a GAAP basis and raised to approximately $24.50 on an Adjusted basis, which contemplates a COVID-19 related headwind of $1.00 per share.
  • Reaffirmed FY 2022 expected individual Medicare Advantage membership growth range of approximately 150,000 to 200,000.
  • The outperformance in 1Q22 is primarily driven by lower than expected administrative expenses and strong results in the company's pharmacy business.

Headline financials

Total Revenue

$24B

Previous: $20.7B+16.0%
EPS (adj)

$8.04

Previous: $7.67+4.8%
Capital Expenditures

-$295M

Previous: -$290M-1.7%
Free Cash Flow

$635M

Previous: $538M+18.0%
Net Income

$930M

Previous: $828M+12.3%
Operating Income

$1.29B

Previous: $1.22B+5.4%
Gross Profit

$24B

Previous: $20.7B+16.0%
Cash & Equivalents

$4.86B

Previous: $3.88B+25.5%
Total Assets

$46.3B

Previous: $37.4B+23.8%
Stock-Based Comp

$43M

Previous: $39M+10.3%

Revenue & EPS history

Humana · Revenue · Quarterly

$24B

Q1 2022+16%vs Q1 2021
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Revenue by segment

Humana · $21.4B total across 1 segment · Q1 2022

  • Insurance
    $21.4B+14.5%

Forward guidance

The company raised its Adjusted EPS guidance for the year ending December 31, 2022 (FY22) by $0.50 per share to ‘approximately $24.50’, representing 19 percent growth over the FY 2021 Adjusted EPS.

Tailwinds

  • Lower than expected administrative expenses.
  • Strong results in the company's pharmacy business fueled by membership favorability.
  • Higher than expected mail-order utilization.
  • Lower unit cost due to favorable underlying drug mix.
  • All other lines of business are performing as expected or slightly positive, further contributing to the company's strong quarter.

Headwinds

  • Updated guidance continues to include a $1.00 embedded COVID headwind.
  • Estimated dilutive impact related to the pending divestiture of the company's 60 percent ownership of Kindred at Home's Hospice and Personal Care divisions.
  • The company expects the favorability to persist throughout the year, although with some moderation, as previous estimates contemplated increasing mail-order penetration rates over the course of the year.
  • Potential inadequacy of government determined payment rates.
  • Potential restrictions on profitability; including by comparison of profitability of the company’s Medicare Advantage business to non-Medicare Advantage business.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2022

Historical avgQ1 2022

+0.9%

Avg return

Earnings day

+0.5%

Avg return

5 days after

+2.8%

Avg return

30 days after

62%

45 / 73 earnings

Positive

+12.4%

Q2 2025

Best reaction

-12.6%

Q2 2012

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+5.5%+3.6%+33.3%
Q4 2025-3.3%+1.5%-8.8%
Q3 2025-6.0%-15.4%-8.5%
Q2 2025+12.4%+6.3%+30.5%
Q1 2025+1.1%-1.0%-10.1%
Q4 2024-3.5%-4.9%-5.6%
Q3 2024+0.0%-0.9%+15.0%
Q2 2024-11.3%-11.9%-12.4%
Q1 2024-5.1%-7.6%+6.5%
Q4 2023-10.2%-6.4%-9.8%
Q3 2023-8.1%-6.9%-5.4%
Q2 2023+6.3%+8.0%+0.5%
Q1 2023+4.7%+6.7%-1.0%
Q4 2022-4.3%-5.0%-2.2%
Q3 2022+1.5%+0.1%-1.4%
Q2 2022-1.7%-3.6%-1.1%
Q1 2022+6.6%+0.7%+7.1%
Q4 2021+9.1%+10.2%+13.0%
Q3 2021-0.8%-0.6%-7.7%
Q2 2021-7.9%-8.1%-13.2%
Q1 2021-0.3%+0.4%-2.5%
Q4 2020+2.1%+0.4%+5.9%
Q3 2020+10.6%+5.9%-1.2%
Q2 2020+4.2%+7.3%+5.6%
Q1 2020+5.2%+4.1%+13.2%
Q4 2019+4.8%+3.0%+7.1%
Q3 2019+6.9%+7.7%+18.1%
Q2 2019+4.8%+0.8%-0.5%
Q1 2019-3.1%-2.3%-4.1%
Q4 2018+0.2%-3.2%-11.6%
Q3 2018+2.3%+1.8%-7.8%
Q2 2018+2.4%+2.8%+6.1%
Q1 2018-2.9%-3.9%-1.9%
Q4 2017-2.5%-0.8%+1.3%
Q3 2017-3.5%-6.0%+0.1%
Q2 2017+7.8%+8.2%+12.1%
Q1 2017+2.0%+3.9%+8.4%
Q4 2016+6.0%+5.9%+11.6%
Q3 2016+5.8%+12.5%+29.2%
Q2 2016+2.5%+4.8%+4.6%
Q1 2016-1.6%
Q4 2015-0.9%
Q3 2015-0.8%
Q2 2015-0.4%
Q1 2015-8.6%
Q4 2014+1.2%
Q3 2014-5.3%
Q2 2014-7.7%
Q1 2014+6.3%
Q4 2013-0.8%
Q3 2013+1.6%
Q2 2013+2.3%
Q1 2013+1.6%
Q4 2012+7.0%
Q3 2012+1.3%
Q2 2012-12.6%
Q1 2012-4.0%
Q4 2011+1.0%
Q3 2011+4.2%
Q2 2011-2.0%
Q1 2011+1.8%
Q4 2010+3.5%
Q3 2010+4.0%
Q2 2010+4.0%
Q1 2009+4.9%
Q1 2010-0.9%
Q4 2009+3.6%
Q4 2007+3.6%
Q3 2008+5.0%
Q3 2009+5.0%
Q4 2008+2.0%
Q2 2009+2.0%
Q2 2008+2.0%

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