Initiatives in place for 2018e recovery

Q2 proved even more challenging than expected for Humana; however, with management saying that all initiatives are now in place for a reversal of trends in 2018, focus has shifted from near-term adjustments to the attractive valuation and strong mid-term outlook. We see solid value support for the shares and reiterate our BUY recommendation; however, owing to slightly lower forecasts and peer group valuation movements, we have cut our target price to SEK78 (81).