Humana (HUM) reported on Monday a stronger-than-expected 21% rise in second-quarter profits and upped its earnings guidance, boosting the health insurer’s stock more than 4% in the premarkets.

The Louisville-based company said it earned $340.1 million, or $2.00 a share, last quarter, compared with $281.8 million, or $1.67 a share, in the year-earlier period. 

Revenue jumped 10% to $8.65 billion.

The results beat expectations from analysts, who forecasted EPS of just $1.67 on slightly lighter revenue of $8.61 billion.

Humana also upgraded its earnings outlook, now projecting 2010 EPS of $5.65 to $5.75 on revenue of between $33.5 billion to $34.5 billion. Analysts estimated Humana would earn $5.71 on $33.94 billion in revenue for 2010. Previously the company saw 2010 EPS of $5.55 to $5.65.

Shareholders cheered the results and outlook, bidding Humana’s stock 4.5% higher to $49.12. The stock was already up 7.1% on the year as of Friday’s close.

“We are pleased with this quarter's performance as it is the result of strength in both our Commercial and Government segments,” CEO Michael McCallister said in a statement. “It is clear our value proposition for seniors in Medicare continues to be well received across the country.”

Humana said its Medicare Advantage membership grew by 17% over the last year to 1.76 million.