A.M. Best Assigns Indicative Issue Credit Ratings to Humana Inc.’s New Shelf Registration
March 16 2018 - 1:33PM
Business Wire
A.M. Best has assigned indicative Long-Term Issue Credit
Ratings of “bbb-” to senior unsecured notes, “bb+” to subordinated
debt and “bb” to preferred stock, to the recently filed universal
shelf registration of Humana Inc. (Humana) (headquartered in
Louisville, KY) [NYSE: HUM]. The outlook assigned to these Credit
Ratings (ratings) is stable. Concurrently, A.M. Best has withdrawn
the ratings on the previous shelf registration. The existing
ratings of Humana and its subsidiaries are unchanged.
Humana’s debt-to-capital leverage is approximately 33% at
year-end 2017, where it is expected to remain in a range below 35%
over the medium term. The ratio had increased following Humana’s
recent issuance of $800 million of debt, and the proceeds were to
be used to fund the redemption of expiring notes in 2018. Earnings
before interest and taxes interest coverage is approximately 17
times earnings at year-end 2017. A.M. Best expects Humana’s
coverage ratio to remain in a range above 10 times earnings in the
near term. Additionally, in 2017, net operating earnings results of
$2.4 billion were partially reflective of the $1.0 billion break-up
fee paid by Aetna Inc., in addition to very strong Medicare
Advantage results and favorable results from its residual
individual commercial line of business.
This press release relates to Credit Ratings that have been
published on A.M. Best’s website. For all rating information
relating to the release and pertinent disclosures, including
details of the office responsible for issuing each of the
individual ratings referenced in this release, please see A.M.
Best’s Recent Rating Activity web page. For
additional information regarding the use and limitations of Credit
Rating opinions, please view Understanding Best’s Credit
Ratings. For information on the proper media use of Best’s
Credit Ratings and A.M. Best press releases, please view
Guide for Media - Proper Use of Best’s Credit Ratings and A.M.
Best Rating Action Press Releases.
A.M. Best is the world’s oldest and most authoritative
insurance rating and information source. For more information,
visit www.ambest.com.
Copyright © 2018 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
####
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A.M. BestWayne KaminskiSenior Financial
Analyst+1 908 439 2200, ext.
5061wayne.kaminski@ambest.comorJoseph Zazzera,
MBADirector+1 908 439 2200, ext.
5797joseph.zazzera@ambest.comorChristopher
SharkeyManager, Public Relations+1 908 439 2200, ext.
5159christopher.sharkey@ambest.comorJim
PeavyDirector, Public Relations+1 908 439 2200, ext.
5644james.peavy@ambest.com
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