Humana shares drop amid Medicare reimbursement proposal
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 18 2025
0mins
Should l Buy HUM?
Source: SeekingAlpha
Humana Inc's stock fell 4.27% and hit a 52-week low amid broader market gains, with the Nasdaq-100 up 0.35% and the S&P 500 up 0.03%.
The decline follows the Trump administration's proposal for a nearly flat reimbursement rate for Medicare Advantage plans in 2027, which is significantly below analysts' expectations. This proposal led to a nearly 13% drop in Humana's shares during after-hours trading, reflecting strong market disapproval and concerns over future profitability. The proposed increase of only 0.09% is expected to weaken insurers' financial positions, potentially impacting their investment capabilities and service offerings.
The implications of this proposal could be severe for Humana and its peers, as the minimal reimbursement increase may lead to reduced profitability and hinder their ability to serve Medicare beneficiaries effectively. Investors are closely monitoring the situation as it unfolds.
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Analyst Views on HUM
Wall Street analysts forecast HUM stock price to rise
19 Analyst Rating
6 Buy
12 Hold
1 Sell
Moderate Buy
Current: 187.120
Low
231.00
Averages
290.39
High
344.00
Current: 187.120
Low
231.00
Averages
290.39
High
344.00
About HUM
Humana Inc. provides Humana insurance services and CenterWell health care services. The Company's segments include Insurance and CenterWell. The Insurance segment consists of Medicare benefits, marketed to individuals or directly via group Medicare accounts, as well as its contract with CMS to administer the Limited Income Newly Eligible Transition (LI-NET) prescription drug plan program and contracts with various states to provide Medicaid, dual eligible demonstration, and Long-Term Support Services benefits. This segment also includes products consisting of employer group commercial fully-insured medical and specialty health insurance benefits marketed to individuals and employer groups. The CenterWell segment includes its pharmacy, primary care, and home solutions operations. The segment also includes its strategic partnerships with WCAS to develop and operate senior-focused, payor-agnostic, primary care centers, as well as its minority ownership interest in hospice operations.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Community Collaboration: By partnering with local community organizations, Humana further addresses its commitment to health-related social needs and advances priorities set by the Illinois Department of Healthcare and Family Services, demonstrating the company's dedication to building healthy communities.
- Ongoing Commitment: This investment builds on Humana's previous grants aimed at urgent needs like food and housing instability, bringing its total commitment to over $3 million, reflecting the company's expertise in addressing complex health-related social needs.
- Integrated Healthcare Services: Under its Fully Integrated Dual Eligible Special Needs Plan in Illinois, Humana has provided grants to various organizations, including Feeding Illinois and the Northern Illinois Food Bank, aiming to enhance the integration of healthcare services and improve the quality of life for its beneficiaries.
See More
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- Market Milestones: The S&P 500 recently hit the 7,000 mark but failed to close above it, indicating market fragility at high levels, which could affect investor confidence and lead to short-term volatility.
- Sector Leadership Shift: In 2026, sectors like energy, materials, and staples have shown impressive gains of 22.5%, 16.9%, and 13.3%, respectively, but these sectors typically lead near market tops, suggesting current leadership may lack sustainability.
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See More
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- New Investment Disclosure: Naya Capital Management UK Ltd disclosed on February 18 that it acquired nearly 1.6 million shares of Masimo, valued at approximately $203 million, indicating strong confidence in the company.
- Asset Allocation Insight: This investment represents 15.3% of Naya Capital's 13F assets under management, positioning Masimo as one of only five reportable holdings, highlighting its significance in the firm's portfolio.
- Market Performance Comparison: Despite Masimo's stock declining 2.6% over the past year, it surged over 34% on February 17 after Danaher announced a $9.9 billion acquisition at $180 per share, showcasing a dramatic price increase from $130.15.
- Investment Risk Advisory: While Naya Capital's timing appears fortuitous, the uncertainty surrounding the acquisition poses significant downside risks for investors, suggesting a cautious approach and potential recommendation to hold off on purchasing shares.
See More
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- Portfolio Overview: Naya Capital's portfolio consists of only five reportable holdings totaling over $1.3 billion, with Masimo being the fifth-largest position, indicating a significant commitment to the company.
- Market Performance: Despite Masimo's shares declining by 2.6% over the past year, they surged by over 34% on February 17 following Danaher's announcement to acquire the company for $9.9 billion, raising the stock price from $130.15 to $174.69.
- Investment Risk Advisory: While Naya Capital's timing appears fortunate, analysts caution that there is considerable downside risk if the acquisition deal fails, suggesting investors should proceed with caution before buying Masimo shares.
See More
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- Quarterly Dividend Announcement: Humana has declared a quarterly dividend of $0.885 per share, consistent with previous distributions, demonstrating the company's ongoing commitment to stable cash flow and shareholder returns.
- Dividend Yield: The forward yield of 1.89% reflects the company's attractiveness in the current market environment, potentially appealing to investors seeking reliable income.
- Payment Schedule: The dividend is payable on April 24, with a record date of March 27 and an ex-dividend date also on March 27, providing shareholders with a clear timeline for investment decisions.
- Market Reaction: Despite Humana's stable dividend policy, concerns about slowing growth in Medicare Advantage, particularly with UnitedHealth and CVS retreating, may exert pressure on the company's stock price and impact investor confidence.
See More
Humana Declares Cash Dividend of $0.885 per Share
- Dividend Declaration: Humana's Board of Directors has declared a cash dividend of $0.885 per share, scheduled for payment on April 24, 2026, aimed at rewarding shareholders and boosting investor confidence.
- Record Date: The record date for shareholders to qualify for this dividend is March 27, 2026, ensuring that those holding shares before this date will benefit, thereby enhancing the value of their investments.
- Company Overview: Humana is a leading U.S. healthcare company focused on helping millions achieve their best health through insurance services and CenterWell healthcare services, improving accessibility and quality of care.
- Community Impact: Humana's services not only enhance the quality of life for Medicare and Medicaid beneficiaries but also benefit families, individuals, and military personnel, reflecting the company's commitment to community health.
See More
