Humana stock rating upgraded at Raymond James on Medicare quality improvement
Raymond James upgraded Humana's stock rating to "Outperform" from "Market Perform," increasing the price target to $520 per share. This comes after Humana announced that 95% of its Medicare Advantage members will be in 4-star or higher plans for the 2027 plan year, up from 41% in 2026. This improvement adds approximately $22 per share to the company's 2027-2028 earnings estimates.
Humana's stock has risen 6.9% over the past week, trading at $431.87, nearing its 52-week high of $456.50. The firm's analysis suggests Humana is undervalued at current levels, with a strong upward momentum of 125% over the past six months. The upgrade also includes $500 million, or about $3 per share, of increased investments tied to the quality rating improvement.
Analysts note that some of this upside may not be sustainable and some allocated to shareholder returns.
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