Traders Buy Large Volume of Call Options on Humana (NYSE:HUM)

Key Points

• Humana saw unusually heavy call-option activity: Traders purchased 8,702 call options, 43% above the typical volume of 6,078 contracts.
• Institutional ownership remains high at 92.38%. BlackRock initiated a multibillion-dollar position, while Pzena Investment Management increased its stake by 34.3%.
• Analyst sentiment is broadly positive, with a “Moderate Buy” consensus and an average price target of $453.30, although Humana shares fell 2.2% to $424.16 and face upcoming earnings-related scrutiny.

Humana Inc. (NYSE:HUM - Get Free Report) was the target of some unusual options trading on Tuesday. Traders acquired 8,702 call options on the company. This represents an increase of 43% compared to the typical volume of 6,078 call options.

Institutional Trading of Humana

Several large investors have recently made changes to their positions in HUM. BlackRock Inc. purchased a new position in shares of Humana during the 2nd quarter valued at $4,138,160,000. Pzena Investment Management LLC boosted its stake in Humana by 34.3% during the first quarter. Pzena Investment Management LLC now owns 5,470,982 shares of the insurance provider's stock valued at $948,614,000 after buying an additional 1,398,774 shares during the period. Legal & General Group Plc bought a new stake in Humana during the second quarter valued at $329,760,000. Barrow Hanley Mewhinney & Strauss LLC purchased a new position in Humana during the second quarter worth about $314,922,000. Finally, Wellington Management Group LLP grew its position in Humana by 7.3% during the second quarter. Wellington Management Group LLP now owns 765,355 shares of the insurance provider's stock worth $304,014,000 after buying an additional 52,004 shares in the last quarter. 92.38% of the stock is currently owned by institutional investors and hedge funds.

Humana Trading Down 2.2%

Shares of Humana stock traded down $9.34 on Tuesday, reaching $424.16. 979,995 shares of the company's stock were exchanged, compared to its average volume of 1,663,244. The company has a market capitalization of $50.93 billion, a P/E ratio of 40.13, a price-to-earnings-growth ratio of 2.67 and a beta of 0.74. Humana has a 52 week low of $163.11 and a 52 week high of $456.50. The firm's 50-day moving average is $389.75 and its two-hundred day moving average is $336.54. The company has a debt-to-equity ratio of 0.62, a quick ratio of 1.74 and a current ratio of 1.74.

Humana (NYSE:HUM - Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The insurance provider reported $7.61 earnings per share for the quarter, beating the consensus estimate of $7.27 by $0.34. Humana had a net margin of 0.88% and a return on equity of 11.20%. The company had revenue of $40.89 billion during the quarter, compared to analyst estimates of $40.58 billion. During the same quarter in the previous year, the business posted $6.27 EPS. Humana's revenue for the quarter was up 26.2% compared to the same quarter last year. Sell-side analysts predict that Humana will post 9.00 EPS for the current fiscal year.

Humana Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Friday, November 27th. Stockholders of record on Friday, October 30th will be issued a dividend of $0.8850 per share. The ex-dividend date is Friday, October 30th. This represents a $3.54 annualized dividend and a dividend yield of 0.8%. Humana's dividend payout ratio is currently 33.49%.

Key Headlines Impacting Humana

Here are the key news stories impacting Humana this week:

• Positive Sentiment: BlackRock joint venture strengthens CenterWell strategy. Humana announced a new venture with funds managed by BlackRock to operate nearly 150 CenterWell Senior Primary Care clinics. BlackRock will hold the majority stake, while CenterWell will retain a minority interest, potentially providing Humana with additional capital and an asset-light structure for expanding senior-focused care. Humana Announces New Strategic Joint Venture with BlackRock to Manage CenterWell Senior Primary Care Clinics
• Positive Sentiment: Analysts raised their outlook for HUM. Mizuho increased its price target to $495 from $468 and maintained an “outperform” rating. Raymond James also upgraded Humana to “outperform” with a $520 target, suggesting analysts see meaningful upside based on improving Medicare Advantage trends and earnings prospects. Humana analyst forecasts
• Positive Sentiment: Medicare Advantage quality ratings improved. Humana said 95% of its members are now enrolled in plans rated four stars or higher for 2027. The improvement could support future bonus payments and enhanced benefits, although the largest financial benefit may not be realized until 2028. Humana Hits 95% Four-Star Coverage
• Neutral Sentiment: Humana will report third-quarter 2026 results on November 6, making upcoming medical-cost trends, Medicare Advantage performance and guidance the next major catalysts. Humana Third-Quarter 2026 Results Date
• Negative Sentiment: UnitedHealth’s strong earnings and outlook lifted the managed-care sector, but its profit beat reportedly benefited partly from reserve releases. That may be limiting enthusiasm for Humana ahead of its own results, particularly after HUM’s sharp recent advance and elevated valuation.

Analysts Set New Price Targets

HUM has been the topic of a number of analyst reports. HSBC lowered Humana to a "hold" rating in a research report on Thursday, July 30th. Leerink Partners raised Humana from a "market perform" rating to an "outperform" rating and set a $513.00 price objective on the stock in a research note on Thursday, July 30th. Wells Fargo & Company upgraded Humana from an "equal weight" rating to an "overweight" rating and upped their target price for the company from $227.00 to $502.00 in a report on Monday, July 13th. Truist Financial increased their target price on shares of Humana from $415.00 to $475.00 and gave the company a "hold" rating in a research report on Monday. Finally, Deutsche Bank Aktiengesellschaft began coverage on shares of Humana in a research report on Thursday, July 30th. They issued a "hold" rating on the stock. Twenty-one analysts have rated the stock with a Buy rating, ten have issued a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average price target of $453.30.

Humana Company Profile

Humana Inc is a health and well-being company headquartered in Louisville, Kentucky. Founded in 1961, the company began as a nursing home operator before expanding into hospitals and health insurance. Today, Humana primarily provides health insurance products and healthcare services for older adults, individuals, military families and other members in the United States.

Humana's insurance business offers Medicare Advantage, Medicare Supplement and prescription drug plans, as well as Medicaid coverage in select markets.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.