We just covered the
10 Best Non-AI Stocks to Buy According to Billionaire Stanley Druckenmiller. Humana Inc. (NYSE:HUM) ranks #9 (see 5 Best Non-AI Stocks to Buy According to Billionaire Stanley Druckenmiller).
Druckenmiller’s Stake: $23,842,000
Humana Inc. (NYSE:HUM) is a US health insurer focused mainly on Medicare Advantage plans for seniors. While the stock is up year to date and has also gained over the past year, it is down 28% over the past five years amid profitability pressure in the Medicare Advantage business.
The bull case for the long term is simple: the pressures are cyclical and partially fixable over time. Humana (NYSE:HUM) is targeting a return to at least a 3% Medicare Advantage margin by 2028, suggesting management expects profitability to recover as pricing, benefits, and utilization normalize. The company also expects earnings growth to resume after a 2026 “reset year,” where current pressures are absorbed and restructured into new plan designs and pricing.
Membership trends still provide some support, with individual Medicare Advantage membership expected to grow by about 25% over 2026, driven by new sales and improved retention. This shows that despite margin pressure, demand for the product remains strong.
A key additional factor is activism. Glenview Capital has recently taken a stake in Humana (NYSE:HUM). Glenview is an activist investor known for pushing operational changes, cost discipline, and strategic restructuring. Bulls argue that Glenview’s involvement could help accelerate a turnaround in execution and capital allocation, similar to how activism previously helped improve sentiment and performance at CVS Health.
Artisan Value Fund stated the following regarding Humana Inc. (NYSE:HUM) in its Q1 2026 investor letter:
“Among the portfolio’s biggest decliners were Salesforce, Accenture, Humana Inc. (NYSE:HUM) and PayPal Holdings, each of which dropped by 20% or more during the quarter. Managed care stocks, including Humana, also declined during the quarter. The sector came under pressure after the Centers for Medicare & Medicaid Services (CMS) released a preliminary 2027 Medicare Advantage rate update that was significantly below expectations. The proposed increase of just 0.09% was essentially flat compared with investor expectations of 4% to 6%. While final rates are often revised higher, the announcement was a meaningful disappointment and adds uncertainty to Humana’s multiyear turnaround. More broadly, the managed care industry continues to face higher medical costs driven by elevated utilization. Humana is also dealing with lower quality ratings under the Medicare Stars program, which could reduce bonus payments over the next several years. Although the stock appears inexpensive following its recent decline, we chose to exit the position given the company’s heavy exposure to Medicare Advantage and the risk that policy and execution challenges could delay a recovery in margins and earnings (Click Here to Read the Letter in Detail).”