A month has gone by since the last earnings report for Humana (HUM Quick QuoteHUM - Free Report) . Shares have added about 0.8% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Humana due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Humana Beats Q3 Earnings on Premium Growth, Updates 2025 View

Humana reported third-quarter 2025 adjusted earnings of $3.24 per share, which beat the Zacks Consensus Estimate by 11.3%. The bottom line decreased 22.1% year over year.

Adjusted revenues of $32.65 billion advanced 11.4% year over year. The top line beat the consensus mark by 2.1%.

The better-than-expected quarterly results were supported by increased premiums, partially offset by elevated expense levels and declining medical memberships.

Q3 Operational Update

Humana’s premiums improved 9.9% year over year to $30.7 billion, beating the Zacks Consensus Estimate by 1.2%. Services revenues of $1.6 billion climbed 45.1% year over year and beat the consensus mark by 15.5%. Investment income came in at $338 million, which slipped 1.5% year over year. The metric beat our model estimate of $312.6 million.

The benefit ratio deteriorated 120 basis points (bps) year over year to 91.1% in the third quarter. Total operating expenses of $32.2 billion escalated 12.5% year over year, higher than our estimate of $31.2 billion. The year-over-year increase was due to higher benefits and operating costs. Adjusted operating cost ratio deteriorated 50 bps year over year to 11.8%. 

HUM’s net income totaled $194 million in the quarter under review, which plunged 59.6% year over year.

Q3 Segmental Update

Insurance

The segment recorded adjusted revenues of $31.2 billion in the third quarter, which improved 9.9% year over year, resulting from improved per-member Medicare premiums coupled with an expanding customer base in stand-alone prescription drug plans and state-based contract businesses.     

Adjusted operating income fell 17.9% year over year to $270 million. The adjusted benefit ratio of 91.1% deteriorated 60 bps year over year. Adjusted operating cost ratio improved 10 bps year over year to 9%.

Total medical membership of the segment was 15 million as of Sep. 30, 2025, which tumbled 8.3% year over year. The metric lagged the Zacks Consensus Estimate of 15.2 million and our model estimate of 15.7 million.

CenterWell

Revenues in the unit advanced 16.6% year over year to $5.9 billion in the quarter under review, which outpaced the Zacks Consensus Estimate by 7.1%. The metric benefited from the back of higher revenues stemming from the company’s pharmacy and primary care businesses.  

Adjusted operating income was $358 million, which decreased 18.5% year over year. The operating cost ratio deteriorated 260 bps year over year to 93.9%, due to higher volumes in CenterWell Specialty Pharmacy.

Humana’s Financial Update (As of Sept. 30, 2025)

Humana exited the third quarter with cash and cash equivalents of $5.4 billion, which surged from the 2024-end level of $2.2 billion. Total assets of $49.7 billion increased from the $46.5 billion figure at 2024-end.  

Long-term debt amounted to $12.6 billion, up from the $11.1 billion figure as of Dec. 31, 2024. Debt to capitalization improved 160 bps year over year to 40.3% at the third-quarter end. 

Total stockholders’ equity of $18.5 billion improved from the $16.4 billion figure at 2024-end.  

HUM generated net cash from operations of $2.6 billion in the first nine months of 2025, which dipped from the prior-year comparable period’s $3.5 billion.

HUM’s Capital Deployment Update

Humana bought back shares worth $109 million in the first nine months of 2025, indicating no buybacks in the third quarter. It also paid dividends of $321 million during the first three quarters.

2025 View

Adjusted earnings per share (EPS) estimate reiterated at around $17.00, which indicates a 4.9% rise from the 2024 figure. GAAP EPS is projected to be roughly $12.26, down from the earlier view of around $13.77. 

Revenues are still estimated to be a minimum of $128 billion. The updated guidance implies an 8.7% increase from the 2024 figure. The Insurance segment’s revenues are still forecasted at a minimum of $123 billion. Revenues of the CenterWell segment are still expected at a minimum of $21.5 billion.

Management anticipates Individual Medicare Advantage membership to witness a decline of around 425,000 in 2025, while the earlier view called for a decrease of up to 500,000. Group Medicare Advantage membership is still expected to stay relatively flat from the 2024-end figure. 

Membership from the Medicare stand-alone PDP is expected to increase around 200,000 this year. State-based contracts are now expected to witness membership growth of around 160,000. 

The benefit ratio of the Insurance unit continues to be projected between 90.1% and 90.5% for 2025. The consolidated adjusted operating cost ratio is anticipated to be within the band of 11.3-11.7%. 

GAAP cash flow from operations continues to be estimated within $2.4 billion and $2.9 billion. Meanwhile, capital expenditures are still projected to be roughly $650 million. The adjusted effective tax rate is expected to be around 25% while the weighted average share count is still anticipated at around 121 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month.

The consensus estimate has shifted -8.41% due to these changes.

VGM Scores

At this time, Humana has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of A on the value side, putting it in the top quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Humana has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Humana is part of the Zacks Medical - HMOs industry. Over the past month, Select Medical (SEM Quick QuoteSEM - Free Report) , a stock from the same industry, has gained 12.8%. The company reported its results for the quarter ended September 2025 more than a month ago.

Select Medical reported revenues of $1.36 billion in the last reported quarter, representing a year-over-year change of -22.6%. EPS of $0.23 for the same period compares with $0.50 a year ago.

Select Medical is expected to post earnings of $0.24 per share for the current quarter, representing a year-over-year change of +33.3%. Over the last 30 days, the Zacks Consensus Estimate has changed -3.4%.

Select Medical has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.