UnitedHealth Stock Down 15.9% in 3 Months: Should You Hold or Fold?

Zacks12-19

Shares of the major healthcare plan provider UnitedHealth Group Incorporated UNH have plunged 15.9% in the past three-month period, outperforming the industry’s decline of 17.5%. However, this decline...

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However, this decline...</p>\n\n<a href=\"https://finance.yahoo.com/news/unitedhealth-stock-down-15-9-183700122.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"ELV","symbol_name":"Elevance Health","start_time":0,"source_url":"https://finance.yahoo.com/news/unitedhealth-stock-down-15-9-183700122.html","article_id":"2492158748","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/8DL4Urc.vcUKmmhh1cXSgg--~B/aD00MDA7dz02MzU7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/529a2bf6a4c772f942409efa3808349b"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2492158748","pubTimestamp":1734547020,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Peers such as Elevance Health, Inc.ELV and Centene Corporation CNC also experienced declines of 31.9% and 23.6%, respectively, in the past three months. 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The company's shares are currently priced at a forward 12-month price/earnings ratio of 16.33, higher than its five-year median of ","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"ELV":"Elevance Health","SG9999014906.USD":"大华全球优质成长基金Acc USD","LU0354030438.USD":"富国美国大盘成长基金Cl A Acc","SG9999017495.SGD":"UGDP UNITED GLOBAL QUALITY GROWTH \"B\" (SGD) ACC","LU0029864427.USD":"TEMPLETON GLOBAL \"A\" (USD) INC","LU0557290698.USD":"施罗德环球可持续增长基金","SG9999003800.SGD":"Nikko AM Global Dividend Equity Acc SGD-H","LU0109391861.USD":"富兰克林美国机遇基金A Acc","LU0342679015.USD":"ALLIANZ GLOBAL EQUITY UNCONSTRAINED \"AT\" (USD) ACC","LU2430703178.SGD":"WELLINGTON MULTI-ASSET HIGH INCOME \"AM4H\" (SGDHDG) INC","LU1506573853.SGD":"MANULIFE GF GLOBAL EQUITY \"AA\" (SGD) INC","LU0079474960.USD":"联博美国增长基金A","SG9999001077.SGD":"United International Growth Fund SGD","LU1670628061.USD":"M&G (LUX) NORTH AMERICAN DIVIDEND \"A\" (USD) INC","LU0640476718.USD":"THREADNEEDLE (LUX) US CONTRARIAN CORE EQ \"AU\" (USD) ACC","LU1037948897.HKD":"AB LOW VOLATILITY EQUITY PORTFOLIO \"AD\" (HKD) INC","IE00B2B36J28.USD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"I1\" (USD) INC","SG9999011175.SGD":"Nikko AM Global Dividend Equity Dis SGD-H","IE00BJT1NW94.SGD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"A2\" (SGDHDG) ACC","UNH":"联合健康","LU2592432038.USD":"WELLINGTON MULTI-ASSET HIGH INCOME \"A\" (USD) ACC","LU0820562030.AUD":"ALLIANZ INCOME AND GROWTH \"AMH2\" (AUDHDG) H2 INC","LU1670627923.USD":"M&G (LUX) NORTH AMERICAN DIVIDEND \"A\" (USD) ACC","LU1323610961.USD":"UBS (LUX) EQUITY SICAV - LONG TERM THEMES (USD) \"P\" (USD) ACC","IE0005OL40V9.USD":"JANUS HENDERSON BALANCED \"A6M\" (USD) INC","LU2361044949.HKD":"WELLINGTON US QUALITY GROWTH \"A\" (HKD) ACC","LU2347655156.SGD":"JPMorgan Investment Funds - Global Income A (icdiv) SGD-H","LU0795875086.SGD":"JPMorgan Investment Funds - Global Income A (div) SGD","LU1489326972.SGD":"First Eagle Amundi International AHS-MD SGD-H","LU2361044865.SGD":"WELLINGTON US QUALITY GROWTH \"A\" (SGDHDG) ACC","LU0211326755.USD":"TEMPLETON GLOBAL INCOME \"A\" (USD) ACC","LU0882574055.USD":"富达全球健康医疗A ACC","LU0965508806.USD":"AB LOW VOLATILITY EQUITY PORTFOLIO \"AD\" (USD) INC","CNC":"康西哥","LU0320765059.SGD":"FTIF - Franklin US Opportunities A Acc SGD","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","LU0949170772.SGD":"Blackrock Global Equity Income A6 SGD-H","SG9999014898.SGD":"United Global Quality Growth Fund Dis SGD","LU0198837287.USD":"UBS (LUX) EQUITY SICAV - USA GROWTH \"P\" (USD) ACC","IE0002270589.USD":"LEGG MASON CLEARBRIDGE VALUE \"A\" (USD) INC","IE00B1BXHZ80.USD":"Legg Mason ClearBridge - US Appreciation A Acc USD","LU0477156797.USD":"HARRIS ASSOCIATES GLOBAL EQUITY \"RE\" (USD) ACC","LU0787776722.HKD":"AB SELECT US EQUITY PORTFOLIO \"A\" (HKD) ACC","LU1291159041.SGD":"CPR Invest - Global Silver Age A2 Acc SGD-H","LU1548497426.USD":"安联环球人工智能AT Acc","LU2552382215.SGD":"WELLINGTON US BRAND POWER \"A\" (SGDHDG) ACC","LU0477156953.USD":"HARRIS ASSOCIATES US VALUE EQUITY \"RE\" (USD) ACC","LU0976567544.SGD":"FTIF - Templeton Global Income A Mdis SGD-H1","LU1074936037.SGD":"JPMorgan Funds - US Value A (acc) SGD","IE00BFTCPJ56.SGD":"Janus Henderson Global Life Sciences A Acc SGD"},"translate_title":"UnitedHealth股价3个月内下跌15.9%：您应该持有还是买入？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ELV":1,"UNH":1,"CNC":1},"content_text":"Shares of the major healthcare plan provider UnitedHealth Group Incorporated UNH have plunged 15.9% in the past three-month period, outperforming the industry’s decline of 17.5%. However, this decline prompts investors to question whether to maintain their positions or sell their shares.\nPeers such as Elevance Health, Inc. ELV and Centene Corporation CNC also experienced declines of 31.9% and 23.6%, respectively, in the past three months. The S&P 500 Index rose 6.5% in the same time frame.\nUNH’s 3-Month Price Performance Comparison\nImage Source: Zacks Investment Research\nMounting public criticism of the insurance industry, reignited by the recent killing of the UNH CEO Brian Thompson and online backlash, has put insurers under intense scrutiny. Legislative pressures, such as the bipartisan bill targeting pharmacy benefit managers and conflicts of interest in the healthcare system, have further weighed on investor confidence. Additionally, broader concerns over rising healthcare costs, regulatory uncertainties, and the potential impact of reforms on insurers' profit margins have exacerbated the downward pressure on the stock.\nFrom a valuation perspective, UnitedHealth is trading at a premium compared to the industry average. The company's shares are currently priced at a forward 12-month price/earnings ratio of 16.33, higher than its five-year median of 19.20 and the industry average of 13.75.\nImage Source: Zacks Investment Research\nUnitedHealth’s robust fundamentals and growth prospects cannot be ignored. Let's have a look at its prospects and growth drivers.\nUNH’s 2025 Guidance\nUNH has provided its 2025 financial guidance, projecting revenues of $450-$455 billion. Optum and UnitedHealthcare sales are estimated to be in the range of $277 billion-$280 billion and $337 billion-$340 billion, respectively.\nAdjusted earnings per share is forecasted to be $29.50-$30 compared with $27.50-$27.75 in 2024.  It expects operating cash flows of $32-$33 billion, with capital expenditures around $4 billion. Additionally, the UnitedHealthcare segment is projected to serve 50.97-51.32 million members by 2025.\nGrowth Drivers\nUnitedHealth’s growth is driven by several factors, including rising commercial membership in the domestic market, expansion in Optum Health's value-based care and new client acquisitions for Optum Rx. Strong membership trends in its Commercial segment reflect its competitive positioning and service diversification, which have supported steady momentum.\nThe company’s financial flexibility is evident in its consistent cash flow, enabling initiatives to boost shareholder value. Operating cash flow jumped 17.3% and 10.9% in 2022 and 2023, respectively. Despite the cyber-attack on its Change Healthcare business in the first quarter, it generated operating cash flows of $21.8 billion in the first nine months of 2024.\nIn June 2024, UnitedHealth raised its quarterly dividend by 12% and returned $9.6 billion to shareholders through buybacks and dividends in the first nine months of 2024. With a dividend yield of 1.73%, which exceeds the industry average of 1.64%, UnitedHealth has a history of consistent dividend increases since 2010.\nHealthcare spending in the United States is increasing, driven by rising disease prevalence. UnitedHealth is well-positioned to benefit from this trend, leveraging its diverse offerings to offset margin pressures from slower private Medicare rate growth.\nUNH’s Estimate Revisions\nUNH’s 2024 and 2025 earnings estimates have witnessed downward adjustments in the past 60 days. Rising medical costs, partly due to the lingering effects of the pandemic, aggressive billing by hospitals and states reducing Medicaid coverage may have resulted in downward adjustments. The company anticipates a medical care ratio of 86.5% (±50 basis points) for 2025, higher than the 2024 expected figure of nearly 84.8%.\nHowever, UNH’s stock still holds promise considering its strong financial fundamentals and segmental growth prospects, helping build resilience against these short-term challenges.\nImage Source: Zacks Investment Research\nConclusion\nThere is no doubt that UNH is facing challenges, firm-specific and industry-specific, leading to a decline in its stock price and a downward revision in its 2024 and 2025 earnings estimates. Moreover, UNH's valuation premium compared to its industry peers raises a concern.\nHowever, UnitedHealth's diversified revenue streams, driven by Optum and UnitedHealthcare, robust cash flow generation, consistent dividend growth, and shareholder-friendly initiatives provide a solid foundation for long-term growth. Given these aspects, retaining this Zacks Rank #3 (Hold) stock appears prudent. Meanwhile, new investors might consider waiting for a more attractive entry point while keeping an eye on its cost-curbing efforts. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\nUnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report\nCentene Corporation (CNC) : Free Stock Analysis Report\nElevance Health, Inc. (ELV) : Free Stock Analysis Report\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2492158748"}