Evercore ISI started covering Humana on Monday. They gave it an In Line rating and set a price target of $295. They said there are some uncertainties in the medium term but strong potential for long-term earnings growth.
Humana is a $33 billion company focused on Medicare Advantage. Analysts said the near-term outlook is unclear. But after 2028, they believe Humana has the right mix of assets to grow earnings steadily. They expect adjusted EBIT to grow at a low double-digit rate and EPS likely at mid-teens annually.
The firm noted management plans to improve top-quartile Stars performance by 2028. They called this goal reasonable and estimated that over 70 percent of members could be in 4-Star or higher plans by then. This could boost earnings per share, though Evercore ISI isn’t counting on a Stars benefit for 2027.
On costs, the analysts expect Humana could achieve $1.6–2.0 billion in operating leverage. They warned, however, that executing this plan carries risk. They also expressed some concern about unclear competition in Medicare Advantage, which could lead to mispricing or higher-than-expected growth and usage in 2026.
Looking further ahead, Evercore ISI said Humana’s current assets should support steady EBIT growth and mid-teens EPS growth after 2028. Key factors that could drive upside include restoring Stars ratings, keeping costs under control, improving margins through retention, and expanding CenterWell. Together, these could push earnings above current forecasts.
Evercore ISI concluded that Humana’s current valuation fairly balances its risks and opportunities. They see a clear path to their $295 price target.