Return on Equity (ROE)
since 2005
Calculation
Humana Inc., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income attributable to Humana1 | ÷ | Stockholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2023 | 15.31% | = | 100 | × | 2,489) | ÷ | 16,262) |
| Dec 31, 2022 | 18.33% | = | 100 | × | 2,806) | ÷ | 15,311) |
| Dec 31, 2021 | 18.24% | = | 100 | × | 2,933) | ÷ | 16,080) |
| Dec 31, 2020 | 24.53% | = | 100 | × | 3,367) | ÷ | 13,728) |
| Dec 31, 2019 | 22.49% | = | 100 | × | 2,707) | ÷ | 12,037) |
| Dec 31, 2018 | 16.56% | = | 100 | × | 1,683) | ÷ | 10,161) |
| Dec 31, 2017 | 24.87% | = | 100 | × | 2,448) | ÷ | 9,842) |
| Dec 31, 2016 | 5.75% | = | 100 | × | 614) | ÷ | 10,685) |
| Dec 31, 2015 | 12.33% | = | 100 | × | 1,276) | ÷ | 10,346) |
| Dec 31, 2014 | 11.89% | = | 100 | × | 1,147) | ÷ | 9,646) |
| Dec 31, 2013 | 13.21% | = | 100 | × | 1,231) | ÷ | 9,316) |
| Dec 31, 2012 | 13.81% | = | 100 | × | 1,222) | ÷ | 8,847) |
| Dec 31, 2011 | 17.60% | = | 100 | × | 1,419) | ÷ | 8,063) |
| Dec 31, 2010 | 15.88% | = | 100 | × | 1,099) | ÷ | 6,924) |
| Dec 31, 2009 | 18.00% | = | 100 | × | 1,040) | ÷ | 5,776) |
| Dec 31, 2008 | 14.52% | = | 100 | × | 647) | ÷ | 4,457) |
| Dec 31, 2007 | 20.69% | = | 100 | × | 834) | ÷ | 4,029) |
| Dec 31, 2006 | 15.96% | = | 100 | × | 487) | ÷ | 3,054) |
| Dec 31, 2005 | 12.47% | = | 100 | × | 308) | ÷ | 2,474) |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
The financial trajectory from 2005 to 2023 is characterized by substantial growth in absolute earnings and capital accumulation, although the efficiency of equity utilization has exhibited significant volatility. While net income and stockholders' equity generally trended upward over the eighteen-year period, the return on equity (ROE) fluctuated, reflecting varying levels of operational efficiency and capital structure shifts.
- Net Income Trends
- Net income grew from 308 million US dollars in 2005 to 2,489 million US dollars in 2023. A period of steady increase was observed between 2005 and 2011, followed by a plateau and a sharp contraction in 2016, where income dropped to 614 million US dollars. A rapid recovery occurred in 2017, with earnings peaking at 3,367 million US dollars in 2020 before entering a gradual decline through 2023.
- Stockholders' Equity Expansion
- A consistent upward trend in stockholders' equity is evident, rising from 2,474 million US dollars in 2005 to 16,262 million US dollars by 2023. This expansion indicates a long-term accumulation of retained earnings and capital. Minor contractions were observed in 2017 and 2022, but these did not disrupt the overall growth trajectory of the company's equity base.
- Return on Equity (ROE) Analysis
- The ROE exhibited three distinct phases. An initial growth phase occurred between 2005 and 2007, peaking at 20.69%. This was followed by a period of volatility and decline from 2008 to 2016, reaching a historical low of 5.75%. A third phase of high performance was seen between 2017 and 2020, where ROE reached a peak of 24.87% in 2017 and remained elevated above 22% in 2019 and 2020. Since 2021, a moderating trend has emerged, with ROE declining to 15.31% by 2023.
- Correlation Between Income and Equity
- The volatility in ROE is largely attributable to the disproportionate movement between net income and equity. For instance, the sharp spike in ROE in 2017 was driven by a surge in net income to 2,448 million US dollars coinciding with a slight decrease in stockholders' equity. Conversely, the decline in ROE from 2021 to 2023 is linked to decreasing net income levels occurring while the equity base continued to expand or remain high.
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Comparison to Competitors
Humana Inc., ROE, long-term trends, comparison to competitors
| Humana Inc. | Abbott Laboratories | Elevance Health Inc. | Intuitive Surgical Inc. | Medtronic PLC | UnitedHealth Group Inc. | |
|---|---|---|---|---|---|---|
| Dec 31, 2023 | 15.31% | 14.83% | 15.23% | 13.51% | 7.30% | 25.22% |
| Dec 31, 2022 | 18.33% | 18.90% | 16.59% | 11.98% | 9.59% | 25.87% |
| Dec 31, 2021 | 18.24% | 19.75% | 16.93% | 14.32% | 7.01% | 24.09% |
| Dec 31, 2020 | 24.53% | 13.71% | 13.77% | 10.90% | 9.44% | 23.52% |
| Dec 31, 2019 | 22.49% | 11.86% | 15.15% | 16.69% | 9.25% | 24.02% |
| Dec 31, 2018 | 16.56% | 7.76% | 13.14% | 16.89% | 6.12% | 23.19% |
| Dec 31, 2017 | 24.87% | 1.54% | 14.50% | 13.97% | 8.01% | 22.10% |
| Dec 31, 2016 | 5.75% | 6.82% | 9.84% | 12.74% | 6.80% | 18.33% |
| Dec 31, 2015 | 12.33% | 20.85% | 11.11% | 13.63% | 5.03% | 17.18% |
| Dec 31, 2014 | 11.89% | 10.61% | 10.60% | 12.39% | 15.76% | 17.31% |
| Dec 31, 2013 | 13.21% | 10.23% | 10.05% | 19.16% | 18.57% | 17.50% |
| Dec 31, 2012 | 13.81% | 22.32% | 11.16% | 18.34% | 21.14% | 17.72% |
| Dec 31, 2011 | 17.60% | 19.35% | 11.36% | 18.71% | 19.39% | 18.17% |
| Dec 31, 2010 | 15.88% | 20.66% | 12.12% | 18.74% | 21.18% | 17.94% |
| Dec 31, 2009 | 18.00% | 25.14% | 19.09% | 15.13% | 16.88% | 16.19% |
| Dec 31, 2008 | 14.52% | 27.92% | 11.62% | 16.13% | 19.34% | 14.33% |
| Dec 31, 2007 | 20.69% | 20.28% | 14.55% | 16.26% | 25.53% | 23.20% |
| Dec 31, 2006 | 15.96% | 12.22% | 12.59% | 12.22% | 27.14% | 19.99% |
| Dec 31, 2005 | 12.47% | 23.39% | 9.86% | 21.27% | 17.26% | 18.61% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Health Care Equipment & Services)
Humana Inc., ROE, long-term trends, comparison to sector (health care equipment & services)
| Humana Inc. | Health Care Equipment & Services | |
|---|---|---|
| Dec 31, 2023 | 15.31% | 17.13% |
| Dec 31, 2022 | 18.33% | 18.40% |
| Dec 31, 2021 | 18.24% | 17.28% |
| Dec 31, 2020 | 24.53% | 15.80% |
| Dec 31, 2019 | 22.49% | 15.85% |
| Dec 31, 2018 | 16.56% | 13.28% |
| Dec 31, 2017 | 24.87% | 12.21% |
| Dec 31, 2016 | 5.75% | 10.70% |
| Dec 31, 2015 | 12.33% | 11.84% |
| Dec 31, 2014 | 11.89% | 13.81% |
| Dec 31, 2013 | 13.21% | 14.22% |
| Dec 31, 2012 | 13.81% | 17.99% |
| Dec 31, 2011 | 17.60% | 17.02% |
| Dec 31, 2010 | 15.88% | 17.62% |
| Dec 31, 2009 | 18.00% | 19.50% |
| Dec 31, 2008 | 14.52% | 17.63% |
| Dec 31, 2007 | 20.69% | 20.02% |
| Dec 31, 2006 | 15.96% | 16.70% |
| Dec 31, 2005 | 12.47% | 16.22% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Health Care)
Humana Inc., ROE, long-term trends, comparison to industry (health care)
| Humana Inc. | Health Care | |
|---|---|---|
| Dec 31, 2023 | 15.31% | 19.40% |
| Dec 31, 2022 | 18.33% | 24.82% |
| Dec 31, 2021 | 18.24% | 25.44% |
| Dec 31, 2020 | 24.53% | 16.70% |
| Dec 31, 2019 | 22.49% | 23.30% |
| Dec 31, 2018 | 16.56% | 21.27% |
| Dec 31, 2017 | 24.87% | 13.77% |
| Dec 31, 2016 | 5.75% | 18.53% |
| Dec 31, 2015 | 12.33% | 18.52% |
| Dec 31, 2014 | 11.89% | 19.17% |
| Dec 31, 2013 | 13.21% | 18.81% |
| Dec 31, 2012 | 13.81% | 18.20% |
| Dec 31, 2011 | 17.60% | 15.90% |
| Dec 31, 2010 | 15.88% | 14.85% |
| Dec 31, 2009 | 18.00% | 20.14% |
| Dec 31, 2008 | 14.52% | 20.29% |
| Dec 31, 2007 | 20.69% | 17.87% |
| Dec 31, 2006 | 15.96% | 20.49% |
| Dec 31, 2005 | 12.47% | 18.28% |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).