UnitedHealth: Investor Day Yields Solid 2024 and Long-Term Outlooks

Narrow-moat UnitedHealth revealed a solid 2024 and long-term outlooks at its annual investor day. Considering cash flows generated by the firm since our last valuation change about a year ago and mildly higher cash flow prospects as its higher-margin, noninsurance business continue to grow at a fast clip, we have raised our fair value estimate on UnitedHealth by a low-double-digit percentage to $520 per share. After this change, shares look about reasonably valued on an absolute basis but still relatively rich compared with many of its managed-care peers when considering their similar growth prospects.