Latest news with #Humana
CNBC
an hour ago
- Business
- CNBC
Wall Street sets sights on Fed announcement that could jolt market
Investors on Wednesday got some strong earnings as well as new data showing the U.S. economy is still rocking despite uncertainty around tariffs. Wall Street didn't seem to care. Stock futures were about flat after the government reported U.S. gross domestic product expanded at a 3% annual rate in the second quarter. That was well above the Dow Jones consensus of 2.3%. At the same time, Humana , Hershey , Kraft Heinz and Mondelez all posted better-than-expected profits since Tuesday's close. What does that non-reaction to positive news tell me? Wall Street has its sights set on the Federal Reserve. The Fed is set to give its latest monetary policy decision at 2 p.m. And while the central bank is almost universally expected to leave its overnight lending rate unchanged at 4.25% to 4.50%, investors will still comb through the statement for clues on future policy moves. Fed Chair Jerome Powell's news conference at 2:30 p.m. ET also adds intrigue to the meeting. As CNBC's Jeff Cox points out in his preview, this will be the first Fed announcement since Donald Trump's visit to the Fed's construction site after the president raised concern over cost overruns on the project. Expect the central bank chief to field questions on that front. On top of that, the Fed has signaled concerns that Trump's tariffs could yet drive inflation higher. "Powell has no easy job with the labor market showing some holes, though prices are still well above his sustainable 2% target and financial conditions are as easy as can be. It would suit Powell again to be non-committal ahead of the September meeting as there remains plenty of time between today and then for him to decide," wrote Peter Boockvar, chief investment officer at One Point BFG Wealth Partners. Watch regional banks Given the anticipation heading into the Fed announcement, the broader market could see sharp moves in either direction after 2 p.m. One group to keep an eye on, according to Goldman Sachs, is regional banks. "We observe that the U.S. banking ETFs (KBE, KRE) have seen unusually large moves on FOMC-day since 2023," wrote John Marshall, head of derivatives research at Goldman. The SPDR S & P Regional Banking ETF (KRE) has averaged a 2.5% move in either direction on Fed days over the past two years. Marshall noted the KRE could also jump after today's decision. "Despite the rally in U.S. financial stocks since their April lows we find that regional banks continue to lag their normal relationship with macro assets. We note the 14% discount currently for the KRE ahead of FOMC," he said.
Reuters
2 hours ago
- Business
- Reuters
Humana raises annual profit forecast as medical costs stabilize
July 30 (Reuters) - Humana (HUM.N), opens new tab raised its annual profit forecast after beating quarterly estimates on Wednesday, as the U.S. health insurer succeeded in keeping its medical costs in check, in contrast to several of its rivals who recently slashed their expectations. The company said its strong quarterly performance was also driven by better-than-expected membership in individual Medicare Advantage plans and strength in its primary care segment CenterWell. Its shares rose nearly 7% in premarket trading. "Following several reductions to guidance, we think this increase will be received positively, as the company's 2025 repricing actions appear to be having their intended effect," said J.P. Morgan analyst Lisa Gill. Larger competitor UnitedHealth (UNH.N), opens new tab flagged underestimation of medical costs on Tuesday, and also provided a full-year profit forecast that fell short of analysts' already diminished estimates. Humana reported a quarterly medical cost ratio - the percentage of premiums spent on medical care - of 89.7%, up from 88.9% a year earlier, but in line with analysts' estimates of 89.71%. The industry has been battling with stubbornly high costs for the last two years due to increased use of healthcare services across government-backed plans. Humana is the top provider of Medicare Advantage plans under which the U.S. government pays private insurers a set rate to manage healthcare for people aged 65 and older, and those with disabilities. CEO Jim Rechtin said the company was confident in the growth outlook for Medicare Advantage and value-based care. "We feel good about our solid performance in the first half of the year." The health insurer said it remained optimistic that its pricing of the Medicare Advantage plans for 2025 will drive margin improvement. It also expects membership decline in the plans to be lower than previously anticipated. Humana projected full-year profit to be about $17 per share, compared with its previous estimate of about $16.25. Analysts on average were expecting a profit of $16.38 per share, as per LSEG data. For the second quarter, the company earned a profit of $6.27 per share, topping estimates of $5.92.
Forbes
3 hours ago
- Business
- Forbes
Humana Reports $545 Million Profit As Costs Land Within Expectations
Humana Wednesday reported $545 million in second quarter profits as the health insurer's medical ... More cost trends fell in line with expectations. In this photo is a Humana office in Louisville, Kentucky, US, on Monday, July 31, 2023. (Photographer: Jon Cherry/Bloomberg) Humana Wednesday reported $545 million in second quarter profits as the health insurer's medical cost trends fell in line with expectations. Like most of its rivals in the health insurance industry, Humana has been seeing higher costs, particularly in its Medicare Advantage plans, which are a big share of Humana's business. Medicare Advantage plans contract with the federal government to provide extra benefits and services to seniors, such as disease management and nurse help hotlines with some also offering vision, dental care and wellness programs. 'We delivered solid results in the second quarter with our insurance segment benefit ratio of 89.9% reflecting medical cost trends that developed in line with our expectations and (second quarter) adjusted earnings per share slightly higher than anticipated,' Humana said in prepared management remarks released along with the company's second quarter earnings report. The benefit expense ratio, which is the percentage of premium revenue that goes toward medical costs, was 89.9% compared to 89.5% in the second quarter of last year. 'We continue to expect the FY 2025 insurance segment benefit ratio to be in a range of 90.1% to 90.5%,' Humana said in its prepared remarks. Still, Humana's net income fell to $545 million, or $4.51 per share, compared to $679 million, or $5.62 a share in the year ago quarter. Revenue rose to $32.4 billion, compared to $29.5 billion in the year-ago period. Given the more predictable cost trends and performance of its Centerwell health services business, which reported growth in specialty pharmacy and primary care, Humana is raising its full year adjusted earnings per share outlook 'from approximately $16.25 to approximately $17.00 supported by solid execution and results through June 30, 2025,' the company said in its prepared remarks. Humana also raised its revenue forecast to be 'at least $128 billion,' up from prior guidance of $126 billion to $128 billion. 'We feel good about our solid performance in the first half of the year,' Humana President and CEO Jim Rechtin said. 'It reinforces our strategy to continue investing in improved outcomes, operational excellence and a better experience for our customers and investors.'
Reuters
4 hours ago
- Business
- Reuters
Insurer Humana raises annual profit forecast as medical costs stabilize
July 30 (Reuters) - Humana (HUM.N), opens new tab raised its annual profit forecast on Wednesday, as the U.S. health insurer bets on its efforts to rein in higher medical costs that have plagued the sector, sending its shares up nearly 5% in premarket trading. The company is a top provider of Medicare Advantage plans under which the U.S. government pays private insurers a set rate to manage healthcare for people aged 65 and older, and those with disabilities. The industry has been battling with persistently high costs for the last two years due to increased use of healthcare services across government-backed plans. However, Humana said its medical costs were in line with its expectations. "We feel good about our solid performance in the first half of the year," CEO Jim Rechtin said in a statement. It reported a quarterly medical cost ratio - the percentage of premiums spent on medical care- of 89.7%, up from 88.9% a year earlier, but in line with analysts' estimates of 89.71%. The company said its quarterly performance was partly driven by better-than-expected membership in its individual Medicare Advantage (MA) plans, as well as strength in its primary care segment CenterWell. Humana expects membership decline in its MA plans to be lower than previously anticipated and said it remains confident that its insurance pricing will drive margin improvement. The company on Wednesday projected full-year profit to be about $17 per share, compared with its previous estimate of about $16.25. Analysts on average were expecting a profit of $16.38 per share, as per data compiled by LSEG. For the quarter, Humana earned a profit of $6.27 per share, compared to estimates of $5.92.
Yahoo
4 hours ago
- Business
- Yahoo
Insurer Humana raises annual profit forecast, shares climb
(Reuters) -Humana raised its annual profit forecast on Wednesday, as the U.S. health insurer bets on its efforts to rein in higher medical costs that have plagued the sector, sending its shares up nearly 6% in premarket trading. The company is a top provider of Medicare Advantage plans under which the U.S. government pays private insurers a set rate to manage healthcare for people aged 65 and older, and those with disabilities. The industry has been battling with persistently high costs for the last two years due to increased use of healthcare services across the government-backed plans. However, Humana said its medical costs were in line with its expectations. It reported a quarterly medical cost ratio - the percentage of premiums spent on medical care- of 89.7%, up from 88.9% a year earlier, but in line with analysts' estimates of 89.71%. Humana now expects full-year profit to be about $17 per share, compared with its previous estimate of about $16.25. Analysts on average were expecting a profit of $16.38 per share. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
