Proactive Investors - Humana (NYSE:HUM) shares tumbled more than 10% in early trade as the Kentucky-based health insurance firm warned its 2024 profits are expected to be impacted by higher costs associated with its Medicare Advantage offering.
The company guided adjusted earnings per share (EPS) guidance of approximately $16, assuming higher Medicare Advantage costs experienced during the fourth quarter will persist throughout this year.
This forecast was far below the analyst forecast of EPS of $30.23, per Zacks Consensus Estimate, and 2023’s full-year EPS of $26.09.
For 4Q, Humana (NYSE:HUM)’s revenue topped estimates but its loss per share was greater than expected, attributed to higher than anticipated Medicare Advantage costs across both inpatient and outpatient.
For 4Q, it reported revenue of $26.5 billion and an adjusted loss per share of $0.11, compared to estimates of $25.4 billion in revenue and a loss per share of $0.07.
For the full year, earnings per share of $26.09 matches estimates while revenue of $106.4 billion was ahead of expectations of $102.3 billion.
Shares of Humana (NYSE:HUM) were down 10.9% at US$358.58 shortly after the opening bell in New York on Thursday.
The company's profit warning dragged on the health insurance sector, with UnitedHealth Group Inc (NYSE:NYSE:UNH) down 4%, CVS Health Corp (NYSE:NYSE:CVS) down 4.1%, and Cigna Group (NYSE:NYSE:CI) down 2.9%.