Humana Q4 Profit Dips 3.5% Due to Rising Costs but Beats Forecast (HUM)

Healthcare company, Humana Inc. (NYSE: HUM) on Monday reported better than expected fiscal fourth-quarter earnings as rising costs for providing benefits in the retail business and higher operating expenses in its  military healthcare unit were offset by falling operating expenses both in retail contracts and for employer groups.

Key Points

• Revenue for the quarter however came short of analysts’ forecast
• Humana said that net income stood at $192 million or $1.19 a share, down from $199 million or $1.20 a share, in the same period of last year
• Analysts polled by Thomson Reuter had most recently forecasted earnings of $1.06 a share

During the fiscal fourth quarter, revenue climbed 6% to $9.56 billion from $9.06 billion, but fell short of Street’s consensus estimate for $9.73 billion.

The Company maintained its outlook on 2013 (first guidance provided in November) earnings, which is expected to come in the range of $7.60 a share to $7.80 a share, citing operational synergy and costs synergy it will gain from its acquisition Metropolitan Health Networks Inc along with improved operating margins.

Revenue for the fiscal 2013 is expected to be at $41 billion to $41.5 billion, which is in-line with analysts’ expectation.

For the current quarter, Humana is expecting earnings to be in the range of $1.75 to $1.85 a share, while analysts’ consensus estimate is for earnings of $1.53 a share, according to a data compiled by Thomson Reuters.

“For 2013, we will continue to enhance our integrated care delivery model, which we believe represents the future of health care delivery, as we forecast another year of growth in revenues, earnings and Medicare membership,” said Bruce D. Broussard, Humana’s chief executive, in a statement on Monday.

HUM shares were up more than 4% in mid-day trading on Monday.

More Posts by this author

• Ester Lauder’s Q2 Profits Soar 13%, Boosts Full-Year Earnings Guidance (EL)
• Stocks Extend Gains, European Equities End Higher
• Forex Market Update: Euro Bounces Back
• Stocks Edge Higher in Early Trading
• Liberty Global in Acquisition Talks with Virgin Media (LBTYA, VMED)
• BP Shares Gain as Q4 Profit Beats Beat Street Estimates (BP)
• Edwards Lifesciences Shares Gain after Company Reports Q4 Results (EW)

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.