Health insurer Humana Inc. (HUM) reported Tuesday that profit for the third quarter nearly doubled from last year, driven by higher revenues. Both adjusted earnings and quarterly revenues topped analysts’ expectations. The company also raised its guidance for the full-year 2020.
For the third quarter, net income grew to $1.34 billion or $10.05 per share from $689 million or $5.14 per share in the prior-year quarter.
Excluding items, adjusted earnings for the quarter were $3.08 per share, compared to $5.03 per share in the year-ago quarter.
On average, analysts polled by Thomson Reuters expected the company to report earnings of $2.81 per share for the quarter. Analysts’ estimates typically exclude special items.
Revenues for the quarter grew 23.6 percent to $20.08 billion from $16.24 billion in the same quarter last year. Adjusted revenues were $18.82 billion. Analysts expected revenues of $18.61 billion for the quarter.
Looking ahead to fiscal 2020, the company now projects earnings in a range of $24.70 to $24.95 per share and adjusted earnings in a range of $18.50 to $18.75 per share.
Previously, the company expected earnings in the range of $23.74 to $24.24 per share and adjusted earnings in the range of $18.25 to $18.75 per share.
The Street was looking for earnings of $18.96 per share for the year.
For the fourth quarter, the company now expects a loss of about $2.55 per share and adjusted loss of about $2.40 per share, based on the fiscal 2020 earnings guidance. Analysts currently expect a loss of $1.78 per share for the quarter.
The loss in the fourth quarter reflects the continued support for the company’s constituents, along with the impact of increasing utilization, and COVID-19 testing and treatment costs.
For fiscal 2020, the company also increased expected full-year individual Medicare Advantage membership growth to about 375,000 members from previous range of 330,000 to 360,000 members, while reaffirming group Medicare Advantage net membership gains, projecting an increase of about 90,000 members year over year.
However, Humana now expects net membership decline of about 500,000 members at its stand-alone PDP business, compared to the previous estimate for a decline of 550,000 members.
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