Humana Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Humana (NYSE:HUM) will unveil its latest earnings on Monday, November 5, 2012. Humana is a managed health care company that offers health and supplemental benefit products.

Humana Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $2.05 per share, a decline of 19.3% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate moved up. It has dropped from $2.06 during the last month. Analysts are projecting profit to rise by 8.6% compared to last year’s $7.15.

Past Earnings Performance: Last quarter, the company topped expectations by 11 cents, coming in at net income of $2.34 per share versus a mean estimate of profit of $2.23 per share. This followed two straight quarters of missing estimates.

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A Look Back: In the second quarter, profit fell 22.7% to $356 million ($2.16 a share) from $460.3 million ($2.71 a share) the year earlier, but exceeded analyst expectations. Revenue rose 4.5% to $9.7 billion from $9.28 billion.

Stock Price Performance: Between August 6, 2012 and October 30, 2012, the stock price rose $11.22 (17.7%), from $63.25 to $74.47. The stock price saw one of its best stretches over the last year between December 30, 2011 and January 11, 2012, when shares rose for eight straight days, increasing 7.9% (+$6.91) over that span. It saw one of its worst periods between May 10, 2012 and May 18, 2012 when shares fell for seven straight days, dropping 6.1% (-$4.87) over that span.

Wall St. Revenue Expectations: Analysts are projecting a rise of 6% in revenue from the year-earlier quarter to $9.86 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 10.4% in the third quarter of the last fiscal year, 8.5% in the fourth quarter of the last fiscal year and 11.2% in the first quarter before increasing again in the second quarter.

The company is trying to use this earnings announcement to rebound from income declines in the past two quarters. Net income dropped 21.3% in the first quarter and then again in the second quarter.

Analyst Ratings: With 15 analysts rating the stock a buy, none rating it a sell and eight rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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