Humana Inc (NYSE:HUM), one of my very long-term portfolio holdings is seeking a sale.
Humana, one of the country’s largest health insurers, is weighing a potential sale of itself after having been approached by several competitors, people briefed on the matter said on Friday.
Any deal for Humana would be expensive: The insurer had a market value of about $27 billion before The Wall Street Journal reported on the company’s deliberations. Humana’s shares jumped 20 percent, closing on Friday at $214.65.
Whether it catches a bid or not, it looks likely to be rebalanced out of my portfolio at the end of the quarter. It’s a sad day for me. I’ve held it since April 2010, and I’d be more than happy to keep holding it. While HUM had plenty of good years in the intervening period, it remained consistently the cheapest or second cheapest stock in my primordial version of the Large Cap 1000 screen, and so I kept holding it. A great first quarter and the announcement about chance of sale this week means that it has run away from the screen, and it time to say goodbye.
Fortunately, there are plenty of good candidates in the Large Cap 1000 screen. It looks likely to be replaced by Fiat Chrysler Automobiles NV (NYSE:FCAU).
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