Humana second-quarter profit rises
Monday, August 1st 2005, 10:00 am
By: News On 6
LOUISVILLE, Ky. (AP) _ Health benefits provider Humana Inc. reported Monday that its second-quarter profit rose as Medicare membership grew more than expected. The company also forecast 2006 earnings above Wall Street expectations and backed its 2005 profit guidance.
Its shares rose $2.94, or 7.4 percent, to $42.79 in morning trading on the New York Stock Exchange. They are approaching the high end of their 52-week range of $17.08 to $44.73.
Humana said quarterly income grew to $84.1 million, or 51 cents per share, for the three months ended June 30 from $80.8 million, or 50 cents per share, a year ago. Revenue rose to $3.55 billion from $3.43 billion last year.
Analysts surveyed by Thomson Financial expected earnings per share of 51 cents on revenue of $3.54 billion.
The company said its Medicare Advantage membership increased 29 percent to 474,300 from last year, primarily on expanded participation in Medicare programs and markets, as well as marketing and other related spending.
The company reaffirmed its 2005 earnings guidance of $2.23 to $2.25 per share, and said it anticipates 2006 profit growth of at least 25 percent, or $2.80 per share. Analysts expect earnings of $2.12 per share for 2005 and $2.49 per share for 2006.
``Given the magnitude of our Medicare opportunity for 2006 and our thorough preparation to take advantage of it, we are comfortable with our ability to achieve the results we are forecasting today,'' Michael B. McCallister, president and chief executive, said in a statement.