Wells Fargo Sticks with Overweight on UnitedHealth (UNH), Trims Target to $267
The company, which was marred by government investigations, operational failures, and leadership changes, reported mixed Q2 2025 earnings results at the end of July. Those results have been unable to shore up the share price, as the long-term growth outlook is still murky.
A close-up of a healthcare professional studying a computer screen with data while consulting with a patient.
The company guided for 2025 adjusted EPS to be over $16, which was significantly below Bloomberg's consensus expectations of $20.4. Seeing the brighter side, Jeff Jonas, portfolio manager at Gabelli Funds, called the guidance highly conservative and believes that it will be easier for the company to beat such low expectations.
However, the steep correction and valuation discount have attracted analysts' interest, with around two-thirds of them having a Buy or equivalent rating. One of the analysts who maintains an optimistic view is Wells Fargo's Stephen Baxter. On August 4, Baxter maintained an Overweight rating on UnitedHealth but lowered his price target to $267 from $306. The revision followed a recently held management meeting where he assessed the company's updated outlook.
According to the analyst, UnitedHealth's management remains confident in the company's ability to meet its reset 2025 guidance. In his view, management is taking a cautious but disciplined approach in factoring in cost trends and margin recovery. Baxter views this conservatism positively, suggesting it reduces the risk of further downside revisions.
UnitedHealth Group Inc. (NYSE:UNH) is a healthcare company that provides health insurance and healthcare solutions in the U.S. and globally under the UnitedHealthcare and Optum brands.
While we acknowledge the potential of UNH as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
READ NEXT: 10 Most Oversold S&P 500 Stocks So Far in 2025 and 10 Most Oversold Semiconductor Stocks So Far in 2025.
Disclosure: None. This article is originally published at Insider Monkey.
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