HUM

Humana Inc

Healthcare, Event Driven/Special Sit


Presented:02/03/2016
Price:$166.78
Cap:$25.09B
Current Price:$257.60
Cap:$31.02B

Presented

Date02/03/2016
Price$166.78
Market Cap$25.09B
Ent Value$30.77B
P/E Ratio19.17x
Book Value$69.85
Div Yield0.7%
Shares O/S150.47M
Ave Daily Vol1,010,194
Short Int1.67%

Current

Price$257.60
Market Cap$31.02B
Humana, Inc. is a health care company that offers a wide range of insurance products and health and wellness services that incorporate an integrated approach to lifelong well-being. The company operates its business through the following segments: Retail, Employer Group, and Health and Well-Being Services. The Retail segment consists of Medicare and commercial fully-insured medical and specialty health insurance benefits, including dental, vision, and other supplemental health and financial protection products, marketed directly to individuals. The Employer Group segment consists of Medicare and commercial fully-insured medical and specialty health insurance benefits, including dental, vision, and other supplemental health and financial protection products, as well as administrative services only products marketed to employer groups. The Health and Well-Being Services segment includes services offered to its health plan members as well as to third parties that promote health and wellness, including provider services, pharmacy, integrated wellness, and home care services. The company was founded by David A. Jones, Sr. and Wendell Cherry in 1961 and is headquartered in Louisville, KY.

Publicly traded companies mentioned herein: Aetna Inc (AET), Humana Inc (HUM)

Highlights

The presenter has owned shares of Humana (HUM) on and off for years, and at this time he likes the risk/ reward ahead of the closure of its pending acquisition by Aetna. He also generally likes the Medicare business and sees the potential for long term, structural growth. Based on the probability of the deal closing and the inherent earnings power of the pro forma entity, “it really doesn’t make sense” for the stock to be trading at ~$168. Overall, he thinks there is a “very strong risk adjusted return to be made over the near term,” and he is long HUM stock.

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