Health insurance company Humana (NYSE: HUM) met Wall Street’s revenue expectations in Q1 CY2026, with sales up 23.5% year on year to $39.65 billion. Its GAAP profit of $9.83 per share was 8.6% below analysts’ consensus estimates.
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Humana (HUM) Q1 CY2026 Highlights:
- Revenue: $39.65 billion vs analyst estimates of $39.47 billion (23.5% year-on-year growth, in line)
- EPS (GAAP): $9.83 vs analyst expectations of $10.75 (8.6% miss)
- Adjusted EBITDA: $1.97 billion vs analyst estimates of $1.96 billion (5% margin, in line)
- Operating Margin: 4.4%, down from 6.3% in the same quarter last year
- Free Cash Flow Margin: 2.9%, up from 0.7% in the same quarter last year
- Customers: 17.71 million, up from 15 million in the previous quarter
- Market Capitalization: $27.58 billion
Company Overview
With over 80% of its revenue derived from federal government contracts, Humana (NYSE: HUM) provides health insurance plans and healthcare services to approximately 17 million members, with a strong focus on Medicare Advantage plans for seniors.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Thankfully, Humana’s 11.9% annualized revenue growth over the last five years was decent. Its growth was slightly above the average healthcare company and shows its offerings resonate with customers.
We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Humana’s annualized revenue growth of 13.6% over the last two years is above its five-year trend, suggesting its demand recently accelerated. 
This quarter, Humana’s year-on-year revenue growth of 23.5% was excellent, and its $39.65 billion of revenue was in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 20.3% over the next 12 months, an improvement versus the last two years. This projection is eye-popping for a company of its scale and implies its newer products and services will catalyze better top-line performance.
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Adjusted Operating Margin
Humana was profitable over the last five years but held back by its large cost base. Its average adjusted operating margin of 3.7% was weak for a healthcare business.
Looking at the trend in its profitability, Humana’s adjusted operating margin decreased by 2.1 percentage points over the last five years. The company’s two-year trajectory also shows it failed to get its profitability back to the peak as its margin fell by 1.9 percentage points. We still like Humana but would like to see some improvement in the future.
In Q1, Humana generated an adjusted operating margin profit margin of 4.6%, down 1.8 percentage points year on year. This reduction is quite minuscule and indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Sadly for Humana, its EPS declined by 19.8% annually over the last five years while its revenue grew by 11.9%. This tells us the company became less profitable on a per-share basis as it expanded due to non-fundamental factors such as interest expenses and taxes.
We can take a deeper look into Humana’s earnings to better understand the drivers of its performance. As we mentioned earlier, Humana’s adjusted operating margin declined by 2.1 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its lower earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.
In Q1, Humana reported EPS of $9.83, down from $10.29 in the same quarter last year. This print missed analysts’ estimates. Over the next 12 months, Wall Street expects Humana’s full-year EPS of $9.34 to grow 12.2%.
Key Takeaways from Humana’s Q1 Results
We struggled to find many positives in these results. Revenue was just in line and EPS missed. The stock remained flat at $228 immediately after reporting.
Humana didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
