Combined average of Moat (AI Resilience), Growth, and Valuation scores.
Moat Score
Humana is the most Medicare-concentrated of the large insurers: about 6.45M individual Medicare Advantage members and the CenterWell primary-care, pharmacy and home-health businesses built around seniors. Its position rests on scale and know-how in one program, not on a structural lock, which is why a single year's star ratings can move its earnings by billions.
Humana has bet the company on one government program and the care model around it. That focus is a real competence, but every pillar it rests on is one a large peer also holds:
- Medicare Advantage Scale: With about 6.45M individual MA members at June 30, 2026, Humana is the second-largest MA insurer behind UnitedHealth. Scale spreads the fixed cost of star-ratings operations, risk adjustment and senior-focused marketing, and it gives Humana negotiating weight with providers in its core Southeast and Midwest markets.
- CenterWell: Owning the Senior Care Model: CenterWell runs senior-focused primary care clinics, a mail-order pharmacy and home health. Q2 2026 segment revenue was $6.79B, up from $5.54B a year earlier, and Senior Primary Care patients grew 27% in the first half. Owning the clinic lets Humana manage the cost of its sickest members directly, the closest thing it has to UnitedHealth's Optum.
- Star Ratings: Payment, Not Moat: Humana's share of MA members in 4+ star plans went from 94% (2024 ratings) to 25% (2025) to about 20% (2026) and back to 95% (2027). The 2025 drop turned on three test calls to its call centre that CMS rated as failures, and courts upheld CMS twice. A score that can lose billions on three phone calls is a yearly payment input, not a durable advantage, and the file rates it that way.
Moat Verdict
Humana's moat is focus, not a structural lock: every pillar it holds is held by at least one larger peer, so nothing scores strong. AI helps its risk-adjustment and care-management operations, but the swing factor in its earnings is CMS policy and a yearly star rating, not AI disruption.
65.0 resilient · 65.0 vulnerable · 80/20 = 65.0 · = 65
Open a moat to read its note.
Providers, brokers and members learn Humana's portals and prior-authorization workflows, but UnitedHealth, Aetna and Elevance run equivalent tools, and seniors re-choose plans every enrollment window.
Risk-adjustment, MA bid pricing and care-management models are tuned to a senior population, and Humana's 2027 star ratings rebound shows real operating know-how. Peers run the same kinds of models, so it is real logic, not logic competitors cannot replicate.
Humana uses public CMS data in its analytics, but its moat never rested on access to public data. Its data advantage is private claims data, rated under proprietaryData.
MA actuaries, star-ratings specialists and geriatric clinicians are scarce, but Humana hires from the same pool as UnitedHealth, Aetna and Elevance.
MA coverage plus CenterWell primary care, mail-order pharmacy and home health is a real senior-care bundle, but members can and do take the plan without the clinic, and no attach or retention figure is on file (M9).
Decades of claims and clinical data on Medicare members feed risk models and CenterWell care programs. It is a large dataset of the same class every MA insurer holds, smaller than UnitedHealth's (M5).
CMS contracts, state licences and MA bid rules bar new entrants, but UnitedHealth, Aetna, Elevance and Centene hold the same approvals (M4). Star ratings are not a lock: Humana's share of members in 4+ star plans went 94% to 25% to about 20% to 95% across the 2024 to 2027 ratings.
Humana's MA provider networks are dense in its core Southeast and Midwest markets, but seniors choose plans county by county and providers contract with several MA insurers at once. UnitedHealth and Elevance earn their network rating on large commercial employer books that Humana largely lacks, so the network does not lock either side here.
Claims, prior authorization and pharmacy benefits run inside provider and member routines, but MA members can switch plans every year during open enrollment, so embedding resets annually.
Humana's claims systems and CenterWell clinical records are the record of care for its members, but every insurer holds the same record for its own book, and providers reconcile against many payers.
About 6.45M individual MA members make Humana the second-largest MA insurer, spreading star-ratings and risk-adjustment costs and supporting provider rates, but UnitedHealth runs a larger book.
Humana is known to seniors, but plan choice runs on premiums, benefits and network in each county, not on a brand premium; not credited separately.
Combined average of Moat (AI Resilience), Growth, and Valuation scores.
Moat Score
Humana is the most Medicare-concentrated of the large insurers: about 6.45M individual Medicare Advantage members and the CenterWell primary-care, pharmacy and home-health businesses built around seniors. Its position rests on scale and know-how in one program, not on a structural lock, which is why a single year's star ratings can move its earnings by billions.
Growth Score
Q2 2026 (reported July 29, 2026) revenue was $40.87B, up about 26% from $32.39B, driven by individual Medicare Advantage membership of 6.45M, up about 23% YoY. Adjusted EPS was $7.61 versus $6.27. The Insurance segment benefit ratio was 91.2%, in line with guidance. FY2026 adjusted EPS guidance was held at at least $9.00, down from $17.14 in 2025, because the 2025 star ratings collapse cut bonus-year 2026 quality bonus payments; GAAP guidance was cut to at least $6.52. CenterWell revenue grew to $6.79B from $5.54B. The 2027 star ratings (95% of members in 4+ star plans) restore bonus payments from 2028, the year management targets a return to a stable margin.
Valuation Score
At $431.87 (October 9, 2026 close, after an 11.6% jump on the 2027 star ratings) HUM sits a little above the $420 base. That is about 48× the trough FY2026 adjusted EPS guide of at least $9.00, so the stock is priced on 2028: the 2027 ratings restore quality bonus payments that TD Cowen puts at $3B or more of extra 2028 revenue (as reported by Healthcare Dive). The base is about 17.5× roughly $24 of 2028 EPS, an inferred figure (2025's $17.14 was earned on 94% of members in 4-star plans and about 5.2M MA members; 2028 adds the 2026 membership cohort at the 3% margin management is bidding for), not company guidance. 17.5× sits above Elevance's roughly 15× and CVS's 12× because Humana's EPS is coming off a trough with more recovery left in it, and below UnitedHealth's base. The Street mean is about $453. The score is the formula at $431.87 on a $300 / $420 / $620 ladder.
The Medicare Specialist
Humana has bet the company on one government program and the care model around it. That focus is a real competence, but every pillar it rests on is one a large peer also holds:
- Medicare Advantage Scale: With about 6.45M individual MA members at June 30, 2026, Humana is the second-largest MA insurer behind UnitedHealth. Scale spreads the fixed cost of star-ratings operations, risk adjustment and senior-focused marketing, and it gives Humana negotiating weight with providers in its core Southeast and Midwest markets.
- CenterWell: Owning the Senior Care Model: CenterWell runs senior-focused primary care clinics, a mail-order pharmacy and home health. Q2 2026 segment revenue was $6.79B, up from $5.54B a year earlier, and Senior Primary Care patients grew 27% in the first half. Owning the clinic lets Humana manage the cost of its sickest members directly, the closest thing it has to UnitedHealth's Optum.
- Star Ratings: Payment, Not Moat: Humana's share of MA members in 4+ star plans went from 94% (2024 ratings) to 25% (2025) to about 20% (2026) and back to 95% (2027). The 2025 drop turned on three test calls to its call centre that CMS rated as failures, and courts upheld CMS twice. A score that can lose billions on three phone calls is a yearly payment input, not a durable advantage, and the file rates it that way.
Moat Verdict
Humana's moat is focus, not a structural lock: every pillar it holds is held by at least one larger peer, so nothing scores strong. AI helps its risk-adjustment and care-management operations, but the swing factor in its earnings is CMS policy and a yearly star rating, not AI disruption.
65.0 resilient · 65.0 vulnerable · 80/20 = 65.0 · = 65
Open a moat to read its note.
Providers, brokers and members learn Humana's portals and prior-authorization workflows, but UnitedHealth, Aetna and Elevance run equivalent tools, and seniors re-choose plans every enrollment window.
Risk-adjustment, MA bid pricing and care-management models are tuned to a senior population, and Humana's 2027 star ratings rebound shows real operating know-how. Peers run the same kinds of models, so it is real logic, not logic competitors cannot replicate.
Humana uses public CMS data in its analytics, but its moat never rested on access to public data. Its data advantage is private claims data, rated under proprietaryData.
MA actuaries, star-ratings specialists and geriatric clinicians are scarce, but Humana hires from the same pool as UnitedHealth, Aetna and Elevance.
MA coverage plus CenterWell primary care, mail-order pharmacy and home health is a real senior-care bundle, but members can and do take the plan without the clinic, and no attach or retention figure is on file (M9).
Decades of claims and clinical data on Medicare members feed risk models and CenterWell care programs. It is a large dataset of the same class every MA insurer holds, smaller than UnitedHealth's (M5).
CMS contracts, state licences and MA bid rules bar new entrants, but UnitedHealth, Aetna, Elevance and Centene hold the same approvals (M4). Star ratings are not a lock: Humana's share of members in 4+ star plans went 94% to 25% to about 20% to 95% across the 2024 to 2027 ratings.
Humana's MA provider networks are dense in its core Southeast and Midwest markets, but seniors choose plans county by county and providers contract with several MA insurers at once. UnitedHealth and Elevance earn their network rating on large commercial employer books that Humana largely lacks, so the network does not lock either side here.
Claims, prior authorization and pharmacy benefits run inside provider and member routines, but MA members can switch plans every year during open enrollment, so embedding resets annually.
Humana's claims systems and CenterWell clinical records are the record of care for its members, but every insurer holds the same record for its own book, and providers reconcile against many payers.
About 6.45M individual MA members make Humana the second-largest MA insurer, spreading star-ratings and risk-adjustment costs and supporting provider rates, but UnitedHealth runs a larger book.
Humana is known to seniors, but plan choice runs on premiums, benefits and network in each county, not on a brand premium; not credited separately.
Growth Analysis
Growth Drivers
Key Risk
If the 2028 star ratings (released October 2027) fall back below 50% of members in 4+ star plans, or CMS cuts MA benchmarks or risk-adjustment coding again for 2028, the bonus recovery the 2027 ratings bought disappears before it is paid and EPS stays near the 2026 trough.
Score Derivation
67.5 base − 10 risk = 58
Base 67.5 (5-9% CAGR, midpoint 7%) + 0 trajectory (individual MA and CenterWell both held stable: no prior-period CenterWell rate is on file to show acceleration) + 0 margin (2026 compression from the star ratings headwind is already in the trough EPS base; the 2027 ratings restore bonuses from 2028, but no benefit-ratio improvement has been reported yet, so the direction is held stable rather than credited before it shows up) - 10 high risk (Humana is the most MA-concentrated large insurer, so MA rate, risk-adjustment and star-ratings policy risk is graded one step above Elevance under G4) = about 58.
Price Scenarios (12–24 Months)
Price vs Targets
Dashed lines mark the 12–24 month bear, base and bull targets. Daily closes.
Valuation Multiples
| P/E (FY2026 adj. guide) | ~48× |
| P/E (2028 recovery EPS ~$24) | ~18× |
| Price / Sales (TTM) | ~0.36× |
| Dividend yield | ~0.8% |
HUM is priced on 2028, not 2026. The trough multiple is meaningless, and the stock trades on whether the 2027 star ratings hold long enough to be paid and whether 2027 benefit cuts keep the membership it added in 2026. A repeat of the 2025 collapse in the October 2027 ratings would take the recovery case off the table.
Approximate figures as of October 2026.
Where We Are vs Targets
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The 2027 star ratings recovery is real but cost trend and the 2027 benefit cuts eat it: membership shrinks, 2027 EPS stays near the trough and the market stops paying for a 2028 recovery.
- The 2028 star ratings released in October 2027 fall back below 50% of members in 4+ star plans, cutting 2029 bonus payments before the 2028 recovery is fully priced
- MA medical cost trend runs above the 2027 bid, keeping the Insurance segment benefit ratio near 92% or higher
- 2027 benefit cuts drive members out during the October to December 2026 enrollment window, reversing much of the 2026 membership gain
The 2027 ratings restore quality bonus payments in 2028, Humana reaches its margin goal of at least 3% on schedule, and the stock trades at about 17.5× roughly $24 of 2028 EPS.
- Quality bonus payments return in 2028 on 95% of members in 4+ star plans, adding billions of revenue as TD Cowen estimates
- Individual MA membership holds roughly flat to modestly up through 2027 despite benefit adjustments
- CenterWell keeps growing revenue in the high teens and expands its share of segment income
Humana keeps 4+ star status for most members in the 2028 ratings too, proving the recovery is operational rather than a one-year swing, and earnings return toward the high-$20s.
- The 2028 star ratings keep 80% or more of members in 4+ star plans, giving two bonus years in a row
- 2028 adjusted EPS reaches the high-$20s as bonuses and the 2026 membership cohort mature together
- CenterWell primary care proves it lowers medical cost for Humana members, supporting a premium multiple