Humana Inc. (HUM): fair value, margin of safety and Wheel Score

Is HUM undervalued?

Humana Inc. (HUM) closed at 432.20 on 16 Oct 2026, 79% above the GLS average fair value of 240.89. 6 of the 8 models that produced a number value the shares below the current price. A gap this wide usually means the market is paying for growth or a story the trailing numbers do not show yet; the models work from filed results, not forecasts, so they are conservative by design.

The 8 models disagree widely: 10 Cap gives 3.89 while DCF gives 652.33. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.

The nightly engine files HUM under Blend.

Nine valuation models for HUM

Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.

Quality and financial health

On financial health HUM scores 7/9 (Piotroski): most of the nine tests - positive earnings and cash flow, falling debt, rising margins and turnover - are passed, which is the kind of balance sheet a wheel trader is happy to be assigned. The GLS Moat score is low at 3.7 out of 10, which says the ten-year record of revenue, earnings, margins and returns on capital has been inconsistent - growth and shocks rather than steady compounding.

Returns on capital are thin or negative - ROIC 3.9%, ROE 6.7%, ROA 2.4% - with debt at 0.73 times equity and negative free cash flow.

The dividend yield is 0.82% with a payout ratio of 34% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Insurance 85%, Center Well 15% (quarter Q2 FY2026).

Institutional ownership scores 10/10, insider activity 10/10 and Congressional trading 5/10 on the GLS smart-money scales.

Wheel Score 59: Fair

HUM scores 59 out of 100 on the Wheel Score (Fair band, 50-64): a usable but unremarkable fit for the wheel strategy. The parts: Value 0/25, Health 16/20, Moat 6/15, Premium 20/20, Stability 18/20. Value (0/25) is where the points are missing.

Implied volatility is 49% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. The option chain is deep: 84,300 contracts of open interest across all expiries, which means tight fills at most strikes.

Volume runs at 1.0M shares a day on a market cap of $51.9B, with a beta of 0.74 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 18 of 20.

The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.

Upcoming events

The next earnings report is due on 6 Nov 2026 (before the open), 21 days away; a 30-45-day put sold today would expire after it, which is worth weighing against the premium. The shares go ex-dividend on 30 Oct 2026 (0.8850 per share), so a covered call sold before then carries a small early-assignment risk around that date.

Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.

Similar stocks in Medical - Healthcare Plans

The 12 companies below are the closest to Humana Inc. by market cap within the Medical - Healthcare Plans industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.

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