Humana beats estimates in Q4 results

Tough decisions, including laying off 2% of its workforce, appear to have paid off

Humana beats estimates in Q4 results

Life & Health

By Alicja Grzadkowska

It looks like some tough decisions, such as laying off 2% of its workforce, have paid off for health insurer Humana. The company today released its Q4 results, which revealed that its profit landed above Wall Street estimates thanks to the performance of its Medicare business.

Sales from Humana’s retail unit, which includes Medicare plans, got a lift of 18.04% to $14.21 billion, as it brought more members onboard for its individual and group plans.

Nonetheless, not all news was good. Humana’s consolidated benefit ratio (the percentage of premiums it spends on claims) worsened to 86.6% in the quarter, compared to 83.4% last year. This number missed consensus estimates of 85.68%.

Humana stated that it expects full-year adjusted earnings per share to range between $18.25 and $18.75 – in line with analysts’ expectations of $18.63 per share.

The company’s net income grew to $512 million in the quarter ended December 31, from $355 million the previous year. Meanwhile, total revenue grew 15.01% to $16.30 billion, reaching above estimates of $16.19 billion.

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