Humana (HUM) Update a 'Mixed Bag' - Susquehanna
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Susquehanna analyst Chris Rigg called news today from Humana (NYSE: HUM) at 'Mixed Bag'.
While the upward guidance revision is a positive, the downward revision to the company’s Medicare STAR scores, which will not impact results until 2018, is a substantial negative and more than offsets the upward guidance revision, the analyst said.
"We believe that if HUM cannot successfully mitigate the issue with CMS, it will be at a material enrollment disadvantage relative to its peers," Rigg said. "By way of background, based on the company’s July 31 membership, the percentage of HUM’s membership in 4-Star or higher plans will decline ~46% (0.98 mln members) in 2018, with all other things being equal."
The firm maintained a Neutral rating and price target of $180 on HUM.
Shares of Humana closed at $177.53 yesterday.
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