Latest news with #UnitedHealth
Globe and Mail
a day ago
- Business
- Globe and Mail
Can UnitedHealth Stock Hit $552 in 2025?
UnitedHealth Group (UNH) is a major healthcare company that provides health insurance through UnitedHealthcare and health services via Optum, serving over 50 million people in the U.S. In the first quarter of 2025, the company reported revenues of $109.6 billion. Recently, it has come under legal scrutiny as the U.S. Department of Justice is reportedly investigating possible Medicare fraud related to its Medicare Advantage business, though UnitedHealth says it has not been officially notified of any investigation. At the same time, the Federal Trade Commission has filed a lawsuit against pharmacy benefit managers (PBMs), including those linked to UnitedHealth, accusing them of inflating insulin prices through rebate schemes. On the economic front, recent actions by the U.S. government aim to lower drug prices and protect American pharmaceutical innovation, signaling increased regulatory scrutiny on healthcare companies. Still, analysts remain confident, keeping a 'Strong Buy' consensus rating and a $392.59 average price target on UnitedHealth. Some analysts have even higher hopes for a UNH rebound - like Piper Sandler, which expects the insurance giant to reach $552 per share. UnitedHealth's Recent Financials UnitedHealth Group (UNH) continues to deliver value to shareholders with an annual dividend of $8.40 per share, offering a yield of 2.82%. The company's market capitalization stands strong at about $270 billion, reflecting its dominant position in the healthcare industry. However, the stock has dropped 40% YTD and is down 4% over the past 5 years, significantly outperforming the broader market's returns over both time frames. Given that depressed price action, UnitedHealth's valuation remains cheap, with a forward adjusted price-to-earnings ratio of 13.05 - about a 37% discount to its own 5-year average. On April 17, UnitedHealth reported first-quarter earnings of $6.85 per share, or $7.20 on an adjusted basis, with revenues climbing $9.8 billion year-over-year to $109.6 billion. The number of consumers served by UnitedHealthcare grew by 780,000 so far this year, while Optum Health expects to add 650,000 new value-based care patients in 2025. The company's medical care ratio rose slightly to 84.8% from 84.3% last year, mainly due to increased senior care activity and Medicare funding changes. Operating costs improved, dropping to 12.4% from 14.1%, thanks to efficiencies across UnitedHealthcare and Optum. Cash flow from operations hit $5.5 billion, with nearly $5 billion returned to shareholders through dividends and share buybacks, resulting in a strong return on equity of 26.8%. Meanwhile, Optum Health generated $25.3 billion in revenue, although growth was partially offset by contract changes and shifts in member profiles. Optum Insight brought in $4.6 billion and holds a revenue backlog of $32.9 billion, with new AI-powered claims processing tools boosting productivity by over 20%. Optum Rx also saw strong results, with revenues rising to $35.1 billion, with adjusted prescriptions increasing to 408 million from 395 million last year. UnitedHealth's Next Chapter UnitedHealth Group's next chapter begins with a significant leadership change and a clear signal of confidence from its top executives. On May 13, CEO Andrew Witty stepped down unexpectedly for personal reasons, and the company suspended its full-year financial outlook due to higher-than-anticipated medical costs, particularly in Medicare Advantage. Stepping in immediately is Stephen Hemsley, who previously led UnitedHealth from 2006 to 2017 and remains chairman of the board. Hemsley's return brings a seasoned hand familiar with steering the company through growth and challenges alike. Demonstrating strong conviction in UnitedHealth's future, Hemsley purchased approximately $25 million worth of shares on May 16, acquiring 86,700 shares at an average price of $288.57. Alongside him, President and CFO John F. Rex also invested nearly $5 million in stock, buying 17,175 shares. This cluster of insider buying sends a powerful message to the market. Wall Street's Take The company also lowered its full-year earnings outlook due to higher medical costs and slower-than-expected growth in some areas. Outgoing CEO Andrew Witty summed it up, saying, 'UnitedHealth Group grew to serve more people more comprehensively but did not perform up to our expectations, and we are aggressively addressing those challenges to position us well for the years ahead.' Piper Sandler analyst Jessica Tassan reaffirmed her 'Overweight' rating on UNH, with a $552 price target that implies potential 82% upside. Tassan cited the recent CEO transition as a key catalyst, expressing confidence that Hemsley's return will stabilize operations and help the company navigate current challenges. 'We believe Mr. Hemsley is the right person to turnaround UNH through repricing at UHC and the standardization of care delivery around best practices at Optum Health,' wrote Hassan, adding: "The company has the assets to control trend, improve clinical outcomes, and optimize the healthcare experience for providers and patients alike. We think Mr. Hemsley can realize this potential." Wall Street's consensus on UNH stock is overwhelmingly positive. All 24 surveyed analysts have assigned a 'Strong Buy' rating, with the average price target at $392.59. This implies roughly a 30% upside from the current trading price. Conclusion Can UnitedHealth stock hit $552 in 2025? While it's an ambitious target, the company's strong fundamentals, leadership changes, and analyst optimism make it possible, but not without challenges. Given the current headwinds and legal pressures, a steady recovery toward the mid-$300s seems more likely in the near term. Still, if UnitedHealth executes well on cost management and growth initiatives, reaching that $552 mark isn't out of the question.
Yahoo
a day ago
- Business
- Yahoo
UnitedHealth Group Stock Is Near 5-Year Lows: Is It a Bargain Buy?
UnitedHealth Group slashed its forecast earlier this year. The company is reportedly facing a criminal probe related to its billing practices. The stock has been falling on recent developments and hasn't been this cheap in years. 10 stocks we like better than UnitedHealth Group › UnitedHealth Group (NYSE: UNH) is one of the biggest health insurers in the U.S. It plays a critical role in the healthcare industry, and for years, it has been a sound stock to invest in. This year, however, has raised significant questions about just how safe the stock really is. Since January, UnitedHealth stock has lost more than 40% of its value. Those kinds of swings may be common for risky meme stocks, but not one of the most reliable health insurers in the world. Is UnitedHealth truly a company that's in deep trouble and a stock you should steer clear of, or is the market overreacting? Could this be one heck of a cheap buy right now? One of the biggest concerns undoubtedly for investors right now is that the healthcare company is reportedly in the midst of a criminal investigation. According to the Wall Street Journal, investigators are looking at whether the company defrauded the federal Medicare program. Meanwhile, The Guardian reported that UnitedHealth allegedly paid nursing homes bonuses for reducing the number of hospital transfers for residents. Doing so would reduce costs for the business but, at the same time, potentially jeopardize the health of those residents. While these allegations haven't been proven, they do appear to be weighing heavily on the business. And what doesn't help matters is that a few weeks ago, UnitedHealth Chief Executive Officer Andrew Witty said that he would be stepping down from his position, stating that he was doing so simply for "personal reasons." Investors may be seeing this as confirmation that the allegations are indeed true and that the business is in deep trouble. Taking over will be Stephen Hemsley, who previously served as the company's CEO. But another reason could be the company's recent financial performance, which has been underwhelming. In April, the company reported quarterly earnings numbers that didn't meet expectations, and the company also slashed its forecast for the year amid rising costs. For the full year, it now expects adjusted earnings per share to fall within a range of $26 to $26.5 -- a sharp reduction from its earlier projection of $29.5 to $30. UnitedHealth stock fell after those results, with reports of criminal wrongdoing sending its shares tumbling even further. If there's a criminal probe into the company's practices, that can potentially be the most alarming issue for investors to worry about. It can affect how the company operates and result in fines. In the longer run, it may even lead to more oversight, resulting in added complexity and increased costs for the business, potentially exacerbating the problems UnitedHealth is facing today. A change in CEO may have been inevitable at this stage. Whether Witty was feeling pressure, was pushed out, or left for some other reason isn't known, but a change in management may be the least surprising result out of all this controversy. But now, let's turn to the positive. UnitedHealth plays an important role in the healthcare industry, serving more than 52 million people. And although the company's financials may not be impressing investors of late, they are still strong. In the past four quarters, UnitedHealth reported $22 billion in net income on revenue totaling $410 billion. And during that stretch, its free cash flow came in at just under $25 billion. The company's robust earnings and cash flow put it in a good position to weather the current storm, as daunting as it may appear right now. Although it may not be an easy path forward, between its strong numbers, its leading position in the health insurance industry, and its previous CEO coming back on board, I'm optimistic that UnitedHealth can recover from the challenges that lay ahead. UnitedHealth stock is down big this year, and it hasn't been trading at these prices since mid-2020. The market has punished the stock not only for poor numbers but also for the uncertainty that lies ahead, not only with what may happen due to the reported criminal probe but also for the potential for broader healthcare reform. How this will all play out is a big question mark, but that certainly doesn't mean the business is doomed. While I wouldn't want to understate the seriousness of UnitedHealth's troubles, investors appear to already be bracing for the worst, and there may be a potential overreaction to these developments, especially with all this bad news coming at the same time. At 12 times earnings, UnitedHealth stock trades at a fairly low price-to-earnings (P/E) ratio. That is well below its five-year average of 25. Given the significant discount, I believe there's a good margin of safety here, and the stock has fallen enough that it may be worth taking a chance on. This isn't a short-term trade by any stretch, but if you're willing to be patient, this could be a good contrarian investment to consider today. 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 $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $830,492!* Now, it's worth noting Stock Advisor's total average return is 982% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 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 Stock Is Near 5-Year Lows: Is It a Bargain Buy? 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
Business Upturn
a day ago
- Business
- Business Upturn
Class Action Filed Against UnitedHealth Group Incorporated (UNH) – July 7, 2025 Deadline to Join – Contact Levi & Korsinsky
NEW YORK, May 30, 2025 (GLOBE NEWSWIRE) — Levi & Korsinsky, LLP notifies investors in UnitedHealth Group Incorporated ('UnitedHealth Group Incorporated' or the 'Company') (NYSE: UNH) of a class action securities lawsuit. CLASS DEFINITION: The lawsuit seeks to recover losses on behalf of UnitedHealth Group Incorporated investors who were adversely affected by alleged securities fraud between December 3, 2024 and April 16, 2025. Follow the link below to get more information and be contacted by a member of our team: UnitedHealth Group Incorporated Lawsuit Submission Form UNH investors may also contact Joseph E. Levi, Esq. via email at [email protected] or by telephone at (212) 363-7500. CASE DETAILS: The filed complaint alleges that defendants made false statements and/or concealed that: (1) UnitedHealth had, for years, engaged in a corporate strategy of denying health coverage in order to boost its profits, and ultimately, its share price; (2) this anti-consumer strategy resulted in regulatory scrutiny against UnitedHealth, which ultimately resulted in the murder of Brian Thompson; (3) animus towards UnitedHealth was such that, subsequent to the murder of Mr. Thompson, many Americans openly celebrated his demise, expressed admiration for his accused killer, and/or otherwise demanded that UnitedHealth change its strategy even if they condemned Mr. Thompson's killing; (4) the foregoing regulatory and public outrage caused UnitedHealth to change its corporate practices; (5) notwithstanding the foregoing, UnitedHealth recklessly stuck with the guidance it issued the day before Thompson's murder, which was unrealistic considering the Company's changing corporate strategies; and (6) as a result, defendants' public statements were materially false and/or misleading at all relevant times. WHAT'S NEXT? If you suffered a loss in UnitedHealth Group Incorporated during the relevant time frame, you have until July 7, 2025 to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as a lead plaintiff. NO COST TO YOU: If you are a class member, you may be entitled to compensation without payment of any out-of-pocket costs or fees. There is no cost or obligation to participate. WHY LEVI & KORSINSKY: Over the past 20 years, the team at Levi & Korsinsky has secured hundreds of millions of dollars for aggrieved shareholders and built a track record of winning high-stakes cases. Our firm has extensive expertise representing investors in complex securities litigation and a team of over 70 employees to serve our clients. For seven years in a row, Levi & Korsinsky has ranked in ISS Securities Class Action Services' Top 50 Report as one of the top securities litigation firms in the United States. CONTACT:Levi & Korsinsky, LLP Joseph E. Levi, Korsinsky, Esq.33 Whitehall Street, 17th FloorNew York, NY 10004 [email protected] Tel: (212) 363-7500Fax: (212) 363-7171
CNBC
a day ago
- Business
- CNBC
Deutsche Bank says take chance on beaten-up UnitedHealth because of valuation
UnitedHealth could be a bargain for investors, according to Deutsche Bank. Analyst George Hill maintained his buy rating along with his target price of $362. That, he said, reflects an earnings multiple of 16 — which sits at the low end of the stock's 10-year trading range. Hill's forecast implies UnitedHealth shares could gain 21.4% from Thursday's close. "We're hanging our gloves on valuation: We maintain our buy rating on UNH's shares, as even here using a trough-ish multiple on our expected 2025 trough earnings still implies meaningful upside to the shares," Hill said in a Thursday note to clients. "We continue to see the company as a defensive name in the large-cap healthcare services space, though UNH has been burdened by a rotating array of headwinds over the last several years," he added. UnitedHealth shares have suffered a 41% decline this year as the company deals with multiple setbacks, including the recent exit of its CEO , suspension of its annual forecast, reports of a Department of Justice investigation into fraud allegations and higher medical costs. "Our target multiple reflects the continued challenges, regulatory overhang, and persistent negative sentiment tied to the MCO space," Hill said. UNH 1Y mountain UnitedHealth 1-yr chart Hill thinks there's plenty of upside ahead for UnitedHealth, but said the company should ditch its current long-term guidance, which sits higher than the range of most other managed care companies. He expects the company's core managed care business to generate operating profit growth of between 3% and 5% as Medicare Advantage plans mature. The company's ability to grow its operating profit growth through acquisition will be "challenged at best," according to the analyst. He added that there also remains an ongoing regulatory overhang on the company and negative sentiment in the managed care space.
Yahoo
2 days ago
- Business
- Yahoo
UnitedHealth Group Incorporated (UNH): A Bull Case Theory
We came across a bullish thesis on UnitedHealth Group Incorporated (UNH) on FluentInQuality's Substack. In this article, we will summarize the bulls' thesis on UNH. UnitedHealth Group Incorporated (UNH)'s share was trading at $295 as of 27th May. UNH's trailing and forward P/E were 12.35 and 12.92 respectively according to Yahoo Finance. alexkich/ UnitedHealth Group is well-positioned as Medicare Advantage grows, with its Optum Health division reaching nearly 100 million consumers annually, reflecting massive scale but showing recent stagnation likely due to market saturation, post-pandemic shifts, and a focus on value-based care. Leadership changes saw the return of former CEO Stephen Hemsley, whose long tenure and deep involvement have driven significant company growth, now reinforced by a substantial equity stake that aligns his interests with shareholders. Employee sentiment, based on thousands of Indeed reviews, is generally positive, highlighting competitive pay, mission alignment, career growth opportunities, and work-life balance, though communication from management could improve. UnitedHealth's financial performance shows strong value creation, with return metrics at the high end for healthcare insurers despite the capital-intensive nature of the industry. Insider and institutional ownership indicate confidence, with major executives and directors holding meaningful stock positions and many institutions increasing their shares. The company's competitive advantages stem from its unmatched scale, extensive provider network, and vertical integration via Optum, which spans insurance, care delivery, pharmacy benefits, and data analytics, creating high switching costs and operational efficiencies. Although its brand faces some reputational challenges, UnitedHealth leverages its vast network and embedded contracts to maintain pricing power and market dominance. The healthcare industry itself is on a robust growth trajectory, with U.S. spending projected to rise from $4.5 trillion in 2024 to $6.8 trillion by 2032, driven by aging demographics, chronic disease, and increased managed care adoption, providing strong secular tailwinds for UnitedHealth's continued expansion and innovation. Previously, we have covered UnitedHealth Group Incorporated (UNH) in April 2025, wherein we summarized a bullish thesis by Oguz Erkan on Substack. The author highlighted its position as a resilient healthcare compounder, benefiting from the defensive nature of health insurance and strong pricing power even during economic downturns. Despite recent challenges and skepticism, UNH's vertically integrated model through Optum supported consistent revenue growth of 11% annually, with a fair valuation reflected in its forward P/E of 20, making it an attractive long-term investment, especially on price dips below $550. UnitedHealth Group Incorporated (UNH) is on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 139 hedge fund portfolios held UNH at the end of the first quarter which was 150 in the previous quarter. While we acknowledge the risk and potential of UNH as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than UNH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock. Disclosure: None. This article was originally published at Insider Monkey. 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
