UnitedHealth (UNH.US) opened more than 9% higher on Tuesday, bringing its monthly gain to 30%, with the stock currently trading at $352.83. The company reported first-quarter profits that significantly exceeded Wall Street forecasts and raised its full-year performance outlook. Financial results showed first-quarter revenue reached $111.72 billion, a 2.0% year-over-year increase, surpassing expectations by $2.06 billion. Adjusted earnings per share were $7.23, higher than the highest analyst estimate in surveys. A key metric measuring medical costs performed better than anticipated, leading the company to raise its full-year profit target by 50 cents per share. Chief Financial Officer Wayne DeVitt said in an interview that all major business segments exceeded management's expectations. DeVitt also noted that UnitedHealth is beginning to see returns on its artificial intelligence investments. He indicated the company expects to invest $1.5 billion in AI this year, with an average return on AI investments of at least 2:1 and positive returns visible within 12 months. Additionally, DeVitt stated that UnitedHealth plans to repurchase at least $2 billion in shares by the end of the second quarter under its existing buyback authorization.
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