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UnitedHealth Group (UNH) Gains But Lags Market: What You Should Know

Zacks Equity Research

UnitedHealth Group (UNH) closed at $240.39 in the latest trading session, marking a +0.1% move from the prior day. This change lagged the S&P 500's 0.83% gain on the day. Elsewhere, the Dow gained 0.93%, while the tech-heavy Nasdaq added 0.9%.

Heading into today, shares of the largest U.S. health insurer had lost 5.82% over the past month, lagging the Medical sector's loss of 1.12% and the S&P 500's loss of 2.38% in that time.

Investors will be hoping for strength from UNH as it approaches its next earnings release. On that day, UNH is projected to report earnings of $3.77 per share, which would represent year-over-year growth of 10.56%. Meanwhile, our latest consensus estimate is calling for revenue of $59.96 billion, up 6.02% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $14.81 per share and revenue of $242.45 billion, which would represent changes of +14.98% and +7.16%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for UNH. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.2% higher. UNH is currently sporting a Zacks Rank of #2 (Buy).

Digging into valuation, UNH currently has a Forward P/E ratio of 16.22. This represents a premium compared to its industry's average Forward P/E of 15.51.

It is also worth noting that UNH currently has a PEG ratio of 1.28. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Medical - HMOs stocks are, on average, holding a PEG ratio of 1.08 based on yesterday's closing prices.

The Medical - HMOs industry is part of the Medical sector. This group has a Zacks Industry Rank of 69, putting it in the top 27% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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