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Yahoo
5 days ago
- Business
- Yahoo
UnitedHealth Group Just Released More Bad News. Should You Avoid the Stock?
Key Points UnitedHealth's recent numbers showed a deep decline in profit. The company's earnings forecast for 2025 came in well below analyst expectations. The stock is trading at a significant discount and is well below where it has been in recent years. 10 stocks we like better than UnitedHealth Group › Things are going from bad to worse for UnitedHealth Group (NYSE: UNH). Investors were already enduring a tough year in 2025, with the company facing myriad bits of bad news, including poor financial results, a change in CEO, and an investigation involving the Department of Justice. Then, the company reported its latest earnings numbers last Tuesday, and shares fell again. As of the close of trading on July 31, the stock had lost half of its value in 2025. And worst of all, it may not have bottomed out just yet. After the company's recent earnings report, which featured even more bad news, investors shouldn't be surprised to see this struggling stock fall even lower in the weeks and months ahead. Are you better off simply avoiding it, or could UnitedHealth actually make for a good contrarian investment? UnitedHealth's forecast badly missed expectations On July 29, UnitedHealth reported its latest earnings numbers, and while the business was growing, its bottom line wasn't. Revenue for the period ending June 30 totaled $111.6 billion and rose by a modest 2% from the same period last year. But what was concerning was that its earnings (the bottom line), which totaled $5.2 billion, were down a staggering 43%. A big problem for the health insurer is rising medical costs. Its medical care ratio rose from 85.1% a year ago to 89.4% this past quarter, which signifies that it's paying out a higher amount of medical expenses relative to the premiums it collects. The higher the ratio, the less profitable the company. In recent years, patients have been resuming treatments and electing to take surgeries that they put off during the earlier days of the pandemic, which has contributed to this increase. Earlier this year, the healthcare company suspended its guidance amid uncertainty around healthcare costs. But under CEO Stephen Hemsley, who took over from Andrew Witty a few months ago, it has released new guidance. The problem is, it's far below what analysts were expecting. UnitedHealth's adjusted earnings per share is projected to come in at $16 or better this year, but Wall Street was expecting $20.91 in adjusted per-share profit. Unsurprisingly, amid such a drastic shortfall, the stock proceeded to drop yet again after the news. How cheap is UnitedHealth stock right now? Shares of UnitedHealth haven't been trading this low since the COVID-19 crash of 2020. Its five-year return is now -16% before factoring in dividends. Based on analyst earnings estimates, the stock is trading at a forward price-to-earnings multiple of 13. But if analysts reduce their expectations for the stock, then that earnings multiple could end up rising. Based on the company's trailing earnings, investors are paying a multiple of around 11. The chart below shows just how extremely low that is compared to where UnitedHealth stock has traded in the past. The stock is trading at a significant discount and could potentially make for an intriguing investment option. Should you avoid UnitedHealth stock, or take a chance on it? Things look bleak for UnitedHealth's stock as the bad news just keeps coming. But if you're willing to take a contrarian position in the company, be patient, and plan to hang on for multiple years, it may not be a bad move to invest in the business today. Given how significantly discounted it is, there's a good margin of safety here for investors. Consider that the average stock on the S&P 500 trades at a price-to-earnings multiple of 25 -- UnitedHealth is nowhere near that. It could take time for the business to turn things around, but it is working on improving profitability, including exiting some Medicare Advantage markets to curb costs. And with an attractive dividend that yields more than 3% as I write this, there's plenty of incentive just to buy and wait. There's some risk with the stock, but I think the sell-off is a bit overblown. While I wouldn't expect a quick turnaround, UnitedHealth can be a good long-term stock to buy on weakness. Should you buy stock in UnitedHealth Group right now? Before you buy stock in UnitedHealth Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and UnitedHealth Group wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $631,505!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,103,313!* Now, it's worth noting Stock Advisor's total average return is 1,039% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy. UnitedHealth Group Just Released More Bad News. Should You Avoid the Stock? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
02-08-2025
- Business
- Reuters
Walmart's Mexico CEO Caride steps down in surprise move
MEXICO CITY, Aug 1 (Reuters) - Walmart's Mexico and Central America chief executive, Ignacio Caride, will step down as CEO and from the board of directors after just over a year, the unit of the U.S. retailer said on Friday in a move that surprised analysts. Walmart's Chile CEO, Cristian Barrientos Pozo, will take over as interim chief executive until a recruitment process is completed, the company said in a statement. Barrientos Pozo, previously senior vice president of operations at Walmart de Mexico, brings more than 26 years of retail experience, including in expansion, store openings and digital transformation, the company said. The company, Mexico's largest retailer, operates Walmart, Sam's Club, and Bodega Aurrera stores across six countries. Known as Walmex, the company reported a 10% drop in net profit in its second-quarter results released in July, citing a slower-than-anticipated recovery in consumer spending despite an 8% increase in sales. Caride's resignation, while unexpected, could be a refreshing change, analysts said. JPMorgan analysts said that despite the "typical noise" around management changes, a refreshed leadership could be welcomed. "Investor concerns have been building around the retail execution weakening over the past year with poor results," the bank said in a note. Antonio Hernandez of Actinver research called the timing "unexpected but positive," especially given the company's declining margins in a competitive market. "We view favorably the company's fully hands-on approach to improve performance," he said. Santander analysts said that while the change could create short-term stock volatility, Barrientos' strong record and familiarity with the market "should help ease concerns during this transition period."
Yahoo
01-08-2025
- Business
- Yahoo
Thom Browne CEO steps down amid dismal sales
This story was originally published on Fashion Dive. To receive daily news and insights, subscribe to our free daily Fashion Dive newsletter. Dive Brief: Thom Browne CEO Rodrigo Bazan is stepping down from his role effective Aug. 31, according to a Wednesday press release from parent company Ermenegildo Zegna Group. Bazan has led the Thom Browne brand since 2016. Sam Lobban, who is currently executive vice president and general merchandising manager for apparel and designer at Nordstrom, will succeed Bazan on Sept. 2, per the release. The announcement came on the same day Zegna Group reported a 3% year-over-year revenue decline to 927.7 million euros, or about $1.1 billion, for the first half of fiscal 2025. Revenue for Thom Browne was down 22.4% for the period to 129.5 million euros, per a separate release. Dive Insight: Zegna Group acquired a majority stake in Thom Browne Inc. in 2018. At the time, the brand was valued at about $500 million, and Bazan, who was the brand's CEO, continued in the role. 'Over the past nine years, I have been working side by side with Rodrigo, and together we have developed Thom Browne from a niche brand into today's luxury icon of modern tailoring,' Thom Browne, chief creative officer and founder of his namesake brand, said in the release. 'I am profoundly grateful for his unwavering support and dedication throughout this extraordinary journey.' Since its acquisition, Thom Browne's revenue has nearly tripled, according to Zegna Group's Chairman and CEO Ermenegildo 'Gildo' Zegna. 'Rodrigo's entrepreneurial vision, along with his pivotal role in Thom Browne's defense of its intellectual property rights against Adidas, has been instrumental in protecting and reinforcing the brand's authentic and unique identity,' Zegna said in the release announcing Bazan's departure. However, the brand has been struggling for a while. Thom Browne revenue dropped 16.8% year over year to 315 million euros in fiscal 2024, and revenue declined 19% in the first quarter of 2025. The company attributed declines at the Thom Browne brand to a decision to reduce exposure in the wholesale channel, and in Q1, the brand posted a 48% year-over-year wholesale drop. In the second quarter of 2025, Zegna Group said in its release that revenue declines at Thom Browne continued to be 'significantly affected by the performance of the wholesale channel, which more than offset the growth recorded in the DTC channel.' The company added that the brand has been streamlining its wholesale channel presence to focus on direct distribution. 'Leading Thom Browne over the past 9 years has been an extraordinary journey,' said Bazan in the release, adding that while he had decided to 'step down to focus on new opportunities,' he would 'always remain connected and supportive of the brand's future.' Meanwhile, Lobban, prior to his time at Nordstrom, worked at Selfridges in London, and was part of Mr Porter's founding team, per the release. While at Nordstrom, he curated brand collaborations, which included work with Thom Browne. Browne said in the release that Lobban's 'deep understanding of [the] brand's distinctive DNA and his visionary approach make him the ideal partner to help shape the future of our brand.' Zegna Group sold 14.1 million treasury shares to Temasek Holdings on Tuesday. The Singapore-based firm now holds 10% of Zegna Group. Recommended Reading 6 luxury firms in need of a turnaround Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
17-07-2025
- Business
- Yahoo
Diageo CEO Debra Crew steps down, FT reports
Diageo (DEO) announced that chief executive Debra Crew has stepped down with immediate effect, Arash Massoudi, Madeleine Speed and Anjli Raval of Financial Times reported. This reportedly follows a period of declining alcohol sales and weakening investor sentiment that weighed heavily on the company's share price. Finance chief Nik Jhangiani will take over as interim CEO while the board begins a formal search for a permanent successor. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See today's best-performing stocks on TipRanks >> Read More on DEO: Disclaimer & DisclosureReport an Issue Diageo price target lowered to 2,460 GBp from 2,490 GBp at Barclays Diageo's Attractive Valuation and Growth Prospects Justify Buy Rating Diageo price target lowered to 1,840 GBp from 1,855 GBp at Morgan Stanley U.S. expected to drop guidance on alcohol consumption, Reuters says Diageo Announces Voting Rights and Director Shareholdings in May 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16-07-2025
- Business
- Yahoo
Jim Cramer on Wendy's: 'It's Not Very Comforting'
The Wendy's Company (NASDAQ:WEN) is one of the stocks on Jim Cramer's radar. Discussing how tariff news has overshadowed corporate news, Cramer mentioned the company and said: 'There are major corporate events that are being completely ignored. Classic example, the big, Wednesday shake up the other day. We came in yesterday and we saw that CEO Kirk Tanner's leaving his job at Wendy's, headed to Hershey. The news broke at the same time that Trump was unleashing his next volley of tariffs. Tanner leaving Wendy's is one of the most significant moves I've seen lately in corporate America, yet people didn't even bother to look at it. Big mistake. A closeup of a juicy hamburger sandwich with tomatoes and lettuce, on a sesame bun. Wendy's (NASDAQ:WEN) operates and franchises quick-service restaurants focused on hamburger sandwiches and manages a portfolio of owned and leased real estate. While we acknowledge the potential of WEN 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: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now. Disclosure: None. This article is originally published at Insider Monkey.
