Stock Analysis & Valuation Humana AB (publ) (0RF7.L)

• Previous Close: £47.40
• Sector Valuation Confidence Level: High

Valuation method	Value, £	Upside, %
Artificial intelligence (AI)	1.00	-98
Intrinsic value (DCF)	10.77	-77
Graham-Dodd Method		n/a
Graham Formula	3.70	-92

Strategic Investment Analysis

Company Overview

Humana AB (publ) is a leading Nordic provider of individual and family care services, specializing in care for children, adults, and the elderly across Sweden, Finland, Norway, and Denmark. Operating through five key segments—Individual & Family, Personal Assistance, Elderly Care, Finland, and Norway—Humana delivers a comprehensive range of services, including psychosocial disorder treatment, residential care, special education, and assisted living. Headquartered in Stockholm, Sweden, the company has established itself as a trusted name in healthcare services, catering to individuals with functional impairments, mental illnesses, and elderly care needs. With a market cap of approximately SEK 2.55 billion, Humana plays a vital role in the Nordic healthcare sector, emphasizing quality care and community support. Its diversified service portfolio and regional presence make it a resilient player in the Medical - Care Facilities industry.

Investment Summary

Humana AB presents a stable investment opportunity within the Nordic healthcare sector, supported by its diversified service offerings and strong regional presence. The company reported SEK 9.65 billion in revenue and SEK 176 million in net income for FY 2023, with a diluted EPS of SEK 3.68. Its low beta of 0.342 suggests lower volatility compared to the broader market, appealing to risk-averse investors. However, high total debt of SEK 5.02 billion and modest dividend yield (SEK 1 per share) may raise concerns about leverage and shareholder returns. Positive operating cash flow (SEK 621 million) and a solid cash position (SEK 675 million) provide financial flexibility. Investors should weigh Humana's steady cash generation against its debt levels and competitive pressures in the fragmented Nordic care market.

Competitive Analysis

Humana AB competes in the Nordic care facilities market, where regional players dominate due to localized regulations and community-based care models. Its competitive advantage lies in its diversified service portfolio, spanning individual & family care, personal assistance, and elderly care, which mitigates reliance on any single segment. The company’s Nordic footprint allows cross-border operational synergies, though it faces stiff competition from both public healthcare providers and private operators. Humana’s scale in Sweden (its largest market) provides cost efficiencies, but its growth in Finland and Norway remains challenged by entrenched local competitors. The personal assistance segment benefits from government-funded programs, ensuring steady demand, but pricing pressures and labor shortages pose risks. Unlike pure-play elderly care providers, Humana’s multi-segment approach offers resilience, though it may lack the specialized focus of niche competitors. Its ability to integrate acquisitions and maintain service quality will be critical in sustaining its market position.

Major Competitors

• Attendo AB (ATT.L): Attendo AB is Humana’s closest peer, offering elderly care, disability, and individual & family care services across the Nordics. It has a larger scale (SEK 14.8 billion revenue in 2023) and stronger brand recognition in elderly care. However, Attendo’s higher debt burden and recent margin pressures due to labor costs weaken its competitive edge. Humana’s more balanced segment mix provides better diversification.
• Careium AB (CARE.ST): Careium focuses on tech-enabled elderly care solutions, differentiating itself with IoT and remote monitoring services. While Humana relies on traditional care models, Careium’s innovation-driven approach appeals to municipalities seeking digital integration. However, Careium’s smaller operational scale (SEK 1.2 billion revenue) limits its competitiveness in broad-based care provision.
• Aleris AB (ALCA.ST): Aleris specializes in outpatient healthcare, overlapping with Humana’s Individual & Family segment. Its strong presence in Sweden and Norway gives it an edge in psychiatric and rehabilitation services. However, Aleris lacks Humana’s breadth in elderly care and personal assistance, making it more vulnerable to sector-specific downturns.
• Aktia Bank (via Esperi Care) (AKTIA.HE): Esperi Care, owned by Aktia Bank, is a key competitor in Finland’s elderly care market. It excels in premium private care services but has limited exposure to Humana’s core psychosocial and disability segments. Humana’s broader service range in Finland gives it an advantage in public tenders.