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United Healthcare: Earnings, A $200 Billion Overreaction

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United Healthcare: Earnings, A $200 Billion Overreaction

One of the most dramatic reactions from the Q1 2025 earnings season came from United Healthcare (NYSE:UNH), which shed over $200 billion in market cap and cratered 23% intra-day post-earnings along with continued decline upon the resignation of its CEO and a potential DOJ inquiry. At first glance, that kind of move suggests something catastrophic although the actual results paint a very different picture. Warning! GuruFocus has detected 4 Warning Sign with UNH. The selloff was driven by a 2% increase in Medicare Advantage costs and higher utilization trends (greater related medical expenses), which led to a reduction in 2025 earnings guidance from $29 to $26 per share initially and later with guidance lifted. That's collectively a $3 hit to EPS which is material from initial guidance, but not earth-shattering especially considering UNH is stil projected to have 20.65 billion in 2024 full year net income based on revisions of major investment banks aggregated by Refinitiv along with 25-30 billion for FY26. That level of profit implies a P/E of roughly 12 and a forward P/E of less than 10 (representing a forward cash flow yield of 10%, a truly absurd financial metric for a company of this size), which is deeply discounted for a business of this scale, profitability, and consistency. The increase in utilization is also expected within the earnings call to normalize to historical averages in the near future and this isn't the first time a Medicare Advantage utilization has caused the share price to decline. In June 2023 a similar utilization increase was seen and the effects were short lived, negligible to profitability and the share price quickly was achieving new highs just a six weeks later. Given how the insurance operation works, premiums can also be raised to offset additional care expenses encountered to maintain similar margins and levels of profitability. The CEO also stepped down due to stated personal reasons, while for investors having a CEO step down is typically seen as something negative, the successor for the position is the long term prior CEO Steven J Hemsley, an executive that oversaw exceptional increases in financial operations, efficiency, and stewardship of the company through industry opportunities. While the stock declined rather significantly upon his appointment, this would seem to be dramatic given the prior CEO executed incredible shareholder returns and growth of operations. The last contributor to major negative sentiment is the "announcement/accusation" by journalists a DOJ probe into medicare advantage billing escalating from civil to criminal (uncorroborated by the DOJ or any legal agency), the company explicitly denied any knowledge or informational requests related to such a probe or its supposed existence and given a prior legal ruling in the civil case that there was no apparent incorrect coding for billing, the legitimacy of this seems to be in question. While if the probe is found to be legitimate in the future, as incredible as it sounds, the company would also likely not have any difficulty financing a fine/outlay of significant size. UNH generates profits from a few large business segments albeit diversified due to the massive scale, the insurance operation in which premiums are received and invested/used to pay out claims respectfully and represents the largest health insurer in the US. The other major component of business operations is Optum, which consists of its pharmacy benefit manager operations, Optum Health which directs healthcare directly, and Optum Insights which provides data analytics and consulting. The hit to guidance was within the legacy insurance segment, which remains wildly profitable although the real driver of earnings growth (a greater than 50% share of net income) is seen within Optum which would seem to be unaffected. UNH's capital allocation strategy has historically been a masterclass in shareholder returns. The company has averaged 2-4 billion in quarterly stock buybacks, while simultaneously paying out close to $8 billion in annual dividends all without compromising operations or balance sheet strength. The most recent buyback spike in Q4 2024 was nearly $5 billion, the largest in the past three years. Based on the outlandish profitability of UNH and the businesses clear willingness and ability to reward shareholders, once you throw in the fact that there is a significant discount being placed on the business by the market, it becomes clear this is a sizable overreaction and not reflective of the operations or strength of the company. *historically repurchases accelerate for UNH under market declines This level of profitability and shareholder alignment is rare, and it's even more compelling now that the market has mispriced the stock on short-term guidance noise. The biggest opportunities in investing often come when price temporarily detaches from financial reality and that's exactly what this looks like. With the regime of a current market built on fear and facing macroeconomic struggles, health insurance is generally considered a defensive, non-cyclical industry because demand for healthcare remains relatively stable regardless of economic conditions. People don't stop needing medical care during a recession and if anything, economic stress can drive higher Medicaid enrollment or subsidized marketplace coverage. For insurers like UNH, revenue is largely tied to premiums and government reimbursements, which are contractual or regulated and don't fluctuate with consumer sentiment or discretionary spending trends. Even during downturns, enrollment can remain stable or even grow as individuals shift from employer-sponsored plans to government-backed options. Unlike cyclical sectors like consumer discretionary or industrials, healthcare spending is inelastic and people prioritize it no matter what. Moreover, Medicare Advantage and Medicaid, which are a large part of UNH's book, are government-funded and relatively insulated from short-term economic cycles. As for the broader industry landscape, there are no meaningful moves underway to undercut or dismantle the private health insurance model. The regulatory outlook remains stable, and there are no current legislative pressures that would structurally alter the business model of companies like UNH. Importantly, this volatility in premiums is limited to the UnitedHealthcare segment. Optum UNH's faster-growing, higher margin division which continues to deliver strong performance across health services, pharmacy benefits, and data analytics. Together, this structure gives UNH a diversified revenue model that can weather temporary shocks in one segment without compromising overall earnings power and represents a significantly undervalued equity at current market prices. * TipRanks. (n.d.). UnitedHealth (NYSE:UNH) stock buybacks. Retrieved May 3, 2025, from This article first appeared on GuruFocus. 擷取數據時發生錯誤登入存取你的投資組合擷取數據時發生錯誤擷取數據時發生錯誤擷取數據時發生錯誤擷取數據時發生錯誤

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United Healthcare: Earnings, A $200 Billion Overreaction

One of the most dramatic reactions from the Q1 2025 earnings season came from United Healthcare (NYSE:UNH), which shed over $200 billion in market cap and cratered 23% intra-day post-earnings along with continued decline upon the resignation of its CEO and a potential DOJ inquiry. At first glance, that kind of move suggests something catastrophic although the actual results paint a very different picture. Warning! GuruFocus has detected 4 Warning Sign with UNH. The selloff was driven by a 2% increase in Medicare Advantage costs and higher utilization trends (greater related medical expenses), which led to a reduction in 2025 earnings guidance from $29 to $26 per share initially and later with guidance lifted. That's collectively a $3 hit to EPS which is material from initial guidance, but not earth-shattering especially considering UNH is stil projected to have 20.65 billion in 2024 full year net income based on revisions of major investment banks aggregated by Refinitiv along with 25-30 billion for FY26. That level of profit implies a P/E of roughly 12 and a forward P/E of less than 10 (representing a forward cash flow yield of 10%, a truly absurd financial metric for a company of this size), which is deeply discounted for a business of this scale, profitability, and consistency. The increase in utilization is also expected within the earnings call to normalize to historical averages in the near future and this isn't the first time a Medicare Advantage utilization has caused the share price to decline. In June 2023 a similar utilization increase was seen and the effects were short lived, negligible to profitability and the share price quickly was achieving new highs just a six weeks later. Given how the insurance operation works, premiums can also be raised to offset additional care expenses encountered to maintain similar margins and levels of profitability. The CEO also stepped down due to stated personal reasons, while for investors having a CEO step down is typically seen as something negative, the successor for the position is the long term prior CEO Steven J Hemsley, an executive that oversaw exceptional increases in financial operations, efficiency, and stewardship of the company through industry opportunities. While the stock declined rather significantly upon his appointment, this would seem to be dramatic given the prior CEO executed incredible shareholder returns and growth of operations. The last contributor to major negative sentiment is the "announcement/accusation" by journalists a DOJ probe into medicare advantage billing escalating from civil to criminal (uncorroborated by the DOJ or any legal agency), the company explicitly denied any knowledge or informational requests related to such a probe or its supposed existence and given a prior legal ruling in the civil case that there was no apparent incorrect coding for billing, the legitimacy of this seems to be in question. While if the probe is found to be legitimate in the future, as incredible as it sounds, the company would also likely not have any difficulty financing a fine/outlay of significant size. UNH generates profits from a few large business segments albeit diversified due to the massive scale, the insurance operation in which premiums are received and invested/used to pay out claims respectfully and represents the largest health insurer in the US. The other major component of business operations is Optum, which consists of its pharmacy benefit manager operations, Optum Health which directs healthcare directly, and Optum Insights which provides data analytics and consulting. The hit to guidance was within the legacy insurance segment, which remains wildly profitable although the real driver of earnings growth (a greater than 50% share of net income) is seen within Optum which would seem to be unaffected. UNH's capital allocation strategy has historically been a masterclass in shareholder returns. The company has averaged 2-4 billion in quarterly stock buybacks, while simultaneously paying out close to $8 billion in annual dividends all without compromising operations or balance sheet strength. The most recent buyback spike in Q4 2024 was nearly $5 billion, the largest in the past three years. Based on the outlandish profitability of UNH and the businesses clear willingness and ability to reward shareholders, once you throw in the fact that there is a significant discount being placed on the business by the market, it becomes clear this is a sizable overreaction and not reflective of the operations or strength of the company. *historically repurchases accelerate for UNH under market declines This level of profitability and shareholder alignment is rare, and it's even more compelling now that the market has mispriced the stock on short-term guidance noise. The biggest opportunities in investing often come when price temporarily detaches from financial reality and that's exactly what this looks like. With the regime of a current market built on fear and facing macroeconomic struggles, health insurance is generally considered a defensive, non-cyclical industry because demand for healthcare remains relatively stable regardless of economic conditions. People don't stop needing medical care during a recession and if anything, economic stress can drive higher Medicaid enrollment or subsidized marketplace coverage. For insurers like UNH, revenue is largely tied to premiums and government reimbursements, which are contractual or regulated and don't fluctuate with consumer sentiment or discretionary spending trends. Even during downturns, enrollment can remain stable or even grow as individuals shift from employer-sponsored plans to government-backed options. Unlike cyclical sectors like consumer discretionary or industrials, healthcare spending is inelastic and people prioritize it no matter what. Moreover, Medicare Advantage and Medicaid, which are a large part of UNH's book, are government-funded and relatively insulated from short-term economic cycles. As for the broader industry landscape, there are no meaningful moves underway to undercut or dismantle the private health insurance model. The regulatory outlook remains stable, and there are no current legislative pressures that would structurally alter the business model of companies like UNH. Importantly, this volatility in premiums is limited to the UnitedHealthcare segment. Optum UNH's faster-growing, higher margin division which continues to deliver strong performance across health services, pharmacy benefits, and data analytics. Together, this structure gives UNH a diversified revenue model that can weather temporary shocks in one segment without compromising overall earnings power and represents a significantly undervalued equity at current market prices. * TipRanks. (n.d.). UnitedHealth (NYSE:UNH) stock buybacks. Retrieved May 3, 2025, from This article first appeared on GuruFocus.

Europe and North America Smart Water Metering Market Report 2025, with Top Vendor Profiles for Sensus, Badger Meter, Itron, Aclara, Neptune Technology, Diehl Metering, Birdz, Kamstrup and more

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Europe and North America Smart Water Metering Market Report 2025, with Top Vendor Profiles for Sensus, Badger Meter, Itron, Aclara, Neptune Technology, Diehl Metering, Birdz, Kamstrup and more

Discover how advanced metering infrastructure (AMI) is transforming water utility operations in Europe and North America. With AMI deployments forecasted to double by 2030, learn about key players, market trends, and communications technologies shaping this growth. Dublin, June 11, 2025 (GLOBE NEWSWIRE) -- The "Smart Water Metering in Europe and North America - 4th Edition" report has been added to offering. The registration and collection of water meter data has historically constituted a highly resource-consuming manual task, requiring professional meter reading personnel to visit each individual metering point to optically register meter consumption values on a periodical basis. Automated meter reading (AMR) solutions which enable wireless walk- or drive-by meter reading operations have over the years automated the work of meter reading personnel to some extent and are today commonplace within water metering operations. Throughout the past two decades, advanced metering infrastructure (AMI) solutions aimed at addressing the shortcomings of AMR by instead leveraging a fixed communications network infrastructure have evolved. By enabling high-frequency readings of detailed meter data while also allowing for direct two-way communications with the utility backoffice, AMI solutions open up entirely new possibilities for water utilities to make substantial enhancements of operational efficiency, reduce non-revenue water (NRW), and greatly improve water conservation schemes. Today, the term smart metering has become a buzzword within the water sector that is to be considered synonymous with the concept of AMI. The number of water AMI endpoints in Europe and North America to twofold by 2030 North America today constitutes the leading market for both AMR and AMI solutions globally and had at the end of 2024 an installed base of 89.8 million active water utility AMR and AMI endpoints, representing a penetration of around 80 percent. AMI accounted for 42 million of the installed endpoints, equalling an AMI penetration of nearly 40 percent. The research forecasts that the number of water AMI endpoints in North America will grow at a compound annual growth rate (CAGR) of 10.8 percent to reach 77.8 million units in 2030. Large-scale deployments of AMI started to gain traction in the region a decade ago and have since grown steadily with multiple projects covering more than 100,000 endpoints now completed. Today, utilities seeking to replace and upgrade their existing AMR solutions account for a substantial share of the AMI installations through meter-park upgrades. Europe is meanwhile the second largest market for AMR and AMI solutions and had at the end of 2024 an installed base of 80.8 million active water utility AMR and AMI endpoints, translating into a penetration rate of approximately 53 percent. Less mature than the North American market, Europe had in 2024 a total of 24 million AMI endpoints installed, representing an AMI penetration of around 16 percent. The number is however forecasted to grow at a CAGR of 17.0 percent to reach 61.6 million units in 2030. France and Spain have historically been the primary markets for water AMI solutions in Europe, but markets such as the UK, Italy, Scandinavia, the DACH region and the Benelux are now also emerging as major water AMI markets. A variety of proprietary and standards-based communications technologies are today used for water AMI deployments. In North America, proprietary RF networking platforms have completely dominated the market and accounted for as much as 91 percent of the installed base of AMI endpoints in 2024. Meanwhile, various proprietary and open-standard RF technologies based on the EN 13757 standard accounted for roughly 43 percent of all AMI endpoints installed in Europe. The category includes Wize, which constitutes one of the most deployed technologies for water AMI in Europe. Other proprietary RF technologies that are not based on EN 13757 accounted for over 32 percent of the European deployments. Optimised for cost-sensitive and mission-critical IoT applications, LoRaWAN and 3GPP-based LPWA technologies have become real contenders within the water AMI markets - particularly LTE-M in the US and LoRaWAN and NB-IoT in Europe. Emerging LPWAN technologies such as Mioty is also gaining traction in Europe, especially in Germany and largely thanks to Diehl Metering's advocacy of the technology. At the end of 2024, LoRaWAN was used to connect a total of 3.7 million endpoints in Europe and this number is forecasted to grow at a CAGR of 28.9 percent to reach 17.0 million in 2030. Cellular communications meanwhile accounted for 5-7 percent of the installed base in both regions and is also forecasted to see massive growth throughout the forecast period, primarily driven by 3GPP-based LPWA deployments. The water AMI and AMR markets in Europe and North America are largely served by local or regional players and only a few companies such as Itron, Sensus (Xylem), Honeywell, Kamstrup, the Arad Group and the Minol-ZENNER Group have managed to establish a major presence in both regions. At the end of 2024, the top 5 water AMI endpoint vendors in North America in terms of installed base were Sensus, Badger Meter, Itron, Aclara (Hubbell) and the Neptune Technology Group (Roper Technologies). The top 5 water AMI endpoint vendors in Europe comprised Diehl Metering, Itron, Sensus, Birdz (Veolia) and Kamstrup. The SUEZ subsidiary SUEZ Smart Solutions also constitutes a key player in the European water AMI market by having been instrumental to the development and deployment of Wize technology. Highlights from the report Insights from 30 new executive interviews with market leading companies. 360-degree overview of next generation RF and cellular standards for water AMI communications. Comprehensive overview of the water utility markets in Europe and North America. Profiles of the key players in the water AMI and AMR industry in Europe and North America. In-depth analysis of the development of AMI deployments in Europe and North America. Detailed market forecasts by region and technology lasting until 2030 Key Questions Answered Which are the main water utilities in Europe and North America? Which major trends are shaping the water AMI markets in Europe and North America? What are the main differences between the European and North American water AMI markets? Which are the leading providers of water AMI and AMR solutions in Europe and North America? What are the main communications technology alternatives for water AMI deployments? Which are some of the largest water AMI projects in each region? How will the communications technology landscape for water AMI change in the coming years? What is the outlook for emerging LPWA networking technologies in the water AMI market? Key Topics Covered: 1 Water Services in Europe and North America1.1 Water services sector in Europe and North America1.1.1 The organisation of water service management1.1.2 Residential water rates and consumption1.1.3 European water distribution system operators1.1.4 North American water distribution system operators 2 Smart Water Metering2.1 Introduction to water metering2.2 Remote meter reading systems2.3 Project strategies2.3.1 System design and sourcing2.3.2 Rollout and integration2.3.3 Implementation and operation2.3.4 Communicating with customers2.3.5 Individual rights issues 3 IoT Networks and Communications Technologies3.1 IoT network technologies3.1.1 Network architectures3.1.2 Unlicensed and licensed frequency bands3.2 3GPP cellular technologies3.2.1 2G/3G/4G/5G cellular technologies and IoT3.2.2 The role of cellular networks in smart meter communications3.2.3 NB-IoT of LTE-M network deployments in Europe and North America3.3 LoRa and LoRaWAN3.3.1 Technology characteristics and network footprint3.4 Sigfox3.5 Mioty3.6 RF technology and standards3.6.1 EN 137573.6.2 Proprietary RF networking platforms4 Smart Metering Industry Players Meter vendors ADD Grup Apator Arad Group Axioma Metering B METERS Badger Meter Diehl Metering E. Wehrle Group (Sontex) Engelmann Sensor FILA GWF Hidroconta Honeywell INTEGRA Metering Iskraemeco Itron Janz (SIT Group) Kamstrup Lorenz Landis+Gyr Maddalena Metron Minol-ZENNER Group Mueller Systems Neptune Technology Group (Roper Technologies) QUNDIS Sagemcom Sensus (Xylem) Communications solution providers Aclara (Hubbell) Abering AIUT APKAPPA Birdz (Veolia) Connexin Ista Netmore Sontex SUEZ Smart Solutions Techem Technolog (Roper Technologies) Telereading Vodafone Software solution providers Atlantica Digital Dropcountr Ferranti Harris Utilities Idrica (Xylem) Indra Oracle TaKaDu Terranova Software VertexOne 5 Water AMR/AMI Market Profiles5.1 Europe5.2 North America6 Water AMR/AMI Projects in Europe and North America by Technology6.1 Water AMI projects in Europe by technology6.1.1 Wize and EN 13757-based RF6.1.2 Proprietary RF technologies not based on EN 137576.1.3 LoRaWAN, Mioty and Sigfox6.1.4 Cellular communications6.2 Water AMI projects in North America by technology6.2.1 Proprietary RF networks6.2.2 Cellular communications 7 Market Analysis7.1 Market forecasts7.2 Industry analysis7.3 Market trends7.3.1 Transition from mechanical to static metering technologies7.3.2 Rapidly growing adoption of standards-based LPWA7.3.3 AMI network implementation and operational models are changing7.3.4 Realising the full potential of water AMI beyond meter-to-cash7.3.5 Digital security - a top priority for future smart water networksFor more information about this report visit About is the world's leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends. CONTACT: CONTACT: Laura Wood,Senior Press Manager press@ For E.S.T Office Hours Call 1-917-300-0470 For U.S./ CAN Toll Free Call 1-800-526-8630 For GMT Office Hours Call +353-1-416-8900

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United Healthcare: Earnings, A $200 Billion Overreaction

United Healthcare: Earnings, A $200 Billion Overreaction

Europe and North America Smart Water Metering Market Report 2025, with Top Vendor Profiles for Sensus, Badger Meter, Itron, Aclara, Neptune Technology, Diehl Metering, Birdz, Kamstrup and more

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United Healthcare: Earnings, A $200 Billion Overreaction

United Healthcare: Earnings, A $200 Billion Overreaction

Europe and North America Smart Water Metering Market Report 2025, with Top Vendor Profiles for Sensus, Badger Meter, Itron, Aclara, Neptune Technology, Diehl Metering, Birdz, Kamstrup and more

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