5 Best Health Insurance Stocks to Buy

Below we present the list of 5 Best Health Insurance Stocks to Buy. For our methodology and a more comprehensive list please see 11 Best Health Insurance Stocks to Buy.

5. Humana Inc. (NYSE:HUM)

Number of Hedge Fund Shareholders: 68

Landing at number five among the 11 best health insurance stocks to buy is Humana Inc. (NYSE:HUM), which steadily rose in popularity among hedge funds throughout 2021 and most of 2022 before sliding back somewhat in the final quarter of last year. Rajiv Jain’s GQG Partners and Jeffrey Smith’s Starboard Value own two of the most prominent HUM positions among hedge funds as of March 31.

Humana Inc. (NYSE:HUM) is the fifth-biggest medical insurer in the world with more than 22 million members and appears poised for strong growth over the next half-a-decade, with analysts predicting the company’s adjusted diluted EPS will rise by 14.3% annually during that time. Deutsche Bank recently raised its price target on HUM to $568 from $562 while retaining a ‘Buy’ rating on the stock, noting that Humana’s acquisitions last year have helped stabilize the company.

Renaissance Investment expects an acceleration in Humana Inc. (NYSE:HUM) Medicare membership growth, as the firm discussed in its Q3 2022 investor letter:

“In September, we added a new position in the Health Care sector with Humana Inc. (NYSE:HUM), one of the largest managed care providers in the U.S. with a focus on medical insurance for the Medicare Advantage market. We believe Humana is poised to see a reacceleration in Medicare Advantage membership growth after making large investments in its program benefits earlier this year. In addition, we like the demographic tailwinds for the entire Medicare Advantage market, as the next four years should provide the highest number of baby boomers yet qualifying for Medicare benefits.”