UnitedHealth Stock (UNH) Rises as Investors Welcome Dividend Approval
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The company announced that it will pay the dividend on March 18, 2025, to all shareholders of record as of March 10, 2025. It must be noted that UnitedHealth has a consistent dividend track record, which now spans over 15 years.
Based on yesterday's closing price of $261.57, UnitedHealth's current dividend yield is nearly 3.21%. Importantly, it remains above the Healthcare sector's average of 1.82%.
Dividend Approved Despite Headwinds
The dividend approval comes as UnitedHealth continues to face rising medical costs, increased regulatory scrutiny, and broader uncertainty across the healthcare sector.
The company's troubles began when it slashed its full-year 2025 earnings forecast after reporting a steep drop in Q2 profits, driven largely by higher-than-expected medical costs. These expenses surged across both Medicare Advantage and commercial plans, prompting UnitedHealth to reevaluate its pricing and benefit structures.
The company now expects $6.5 billion in additional medical costs this year, with ripple effects likely to stretch into 2026. As a result, UnitedHealth is exiting certain Medicare Advantage markets, impacting roughly 600,000 enrollees. Meanwhile, the Department of Justice is investigating UNH's Medicare billing practices.
Despite these headwinds, the company states that its long-term growth plan remains on track, with a focus on AI tools and enhancing patient care.
Is UNH a Good Buy Right Now?
average UnitedHealth stock price target implies a 25.36% upside potential.
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