UnitedHealth: Buy Or Sell UNH Stock At $325?

Forbes

2 days ago

CANADA - 2025/04/06: In this photo illustration, the UnitedHealth Group logo is seen displayed on a ... More smartphone screen. (Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images)
UnitedHealth's stock (NYSE:UNH) has undergone a noticeable decline, decreasing from a peak of around $600 in April to about $275 in May, and then making a slight recovery to $325. This drop followed the company's announcement of disappointing Q1 results, the later retraction of its earnings forecast, and sudden shifts in top management. While these occurrences have naturally raised concerns regarding UNH stock, it is also trading at very appealing valuations. Additionally, as outlined below, the company exhibits robust operating performance and financial health across key metrics such as Growth, Profitability, Financial Stability, and Downturn Resilience. Nevertheless, for those investors who prefer less volatility than individual stocks, the Trefis High Quality portfolio offers an alternative — having surpassed the S&P 500 and delivered returns greater than 91% since its inception. Separately, see – SOFI Stock To $30?
How Does UnitedHealth's Valuation Look vs. The S&P 500?
When considering what you pay per dollar of sales or profit, UNH stock appears inexpensive in relation to the broader market.
How Have UnitedHealth's Revenues Grown Over Recent Years?
UnitedHealth's Revenues have exhibited significant growth in recent years.
How Profitable Is UnitedHealth?
UnitedHealth's profit margins are significantly lower than those of most companies covered by Trefis.
Does UnitedHealth Look Financially Stable?
UnitedHealth's balance sheet appears robust.
How Resilient Is UNH Stock During A Downturn?
UNH stock has proven to be more resilient than the benchmark S&P 500 index during some recent downturns. As investors speculate on the possibility of a soft landing in the U.S. economy, how serious could it get if another recession strikes? Our dashboard How Low Can Stocks Go During A Market Crash shows how significant stocks fared during and after previous market crashes.
Putting All The Pieces Together: What It Means For UNH Stock
In conclusion, UnitedHealth's performance regarding the outlined metrics is as follows:
UnitedHealth has shown strong performance across the previously mentioned parameters. This, in conjunction with its current low valuation, renders the stock appealing and reinforces our finding that UNH represents a worthwhile buying opportunity.
Of course, there's always a level of uncertainty. In light of the recent challenges, including Centene's latest withdrawal of guidance, investors may be cautious about selecting UNH. However, for long-term investors, the presently discounted valuation is likely advantageous, especially given the company's consistent history of strong performance.
While UNH stock appears promising, investing in a single stock can carry risks. Conversely, the Trefis High Quality (HQ) Portfolio, comprising 30 stocks, has a history of comfortably outperforming the S&P 500 over the last 4-year period. What accounts for this? Collectively, HQ Portfolio stocks produced superior returns with lower risk compared to the benchmark index; providing a less turbulent experience, as demonstrated by HQ Portfolio performance metrics.