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UnitedHealth Group Inc UNH

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Stock XNYS Rating as of
$550.82 +15.77 (2.95%)
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Company Report

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

Julie Utterback

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.

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Price vs Fair Value

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UNH is trading at a 3% premium.
Price
$536.54
Fair Value
$999.00
Uncertainty
Medium
1-Star Price
$716.00
5-Star Price
$625.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

UnitedHealth's strategy of providing medical insurance, pharmacy benefits, and healthcare services creates a powerful alignment of incentives that should help clients control their healthcare costs better than pure-play competitors.

Bears

Economic downturns could cut into UnitedHealth's near-term earnings power, especially if employer-based insurance rolls shrink.

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Trading Information

Previous Close Price
$535.05
Day Range
$534.19–551.12
52-Week Range
$445.72–552.85
Bid/Ask
$550.67 / $550.90
Market Cap
$509.15 Bil
Volume/Avg
1.2 Mil / 2.8 Mil

Key Statistics

Price/Earnings (Normalized)
22.02
Price/Sales
1.40
Dividend Yield
1.32%
Dividend Yield (Forward)
1.41%
Total Yield
2.59%

Company Profile

UnitedHealth Group is one of the largest private health insurers, providing medical benefits to about 53 million members globally, including 5 million outside the U.S. as of mid-2023. As a leader in employer-sponsored, self-directed, and government-backed insurance plans, UnitedHealth has obtained massive scale in managed care. Along with its insurance assets, UnitedHealth's continued investments in its Optum franchises have created a healthcare services colossus that spans everything from medical and pharmaceutical benefits to providing outpatient care and analytics to both affiliated and third-party customers.
Sector
Healthcare
Industry
Healthcare Plans
Stock Style Box
Large Core
Total Number of Employees
400,000
Website
https://www.unitedhealthgroup.com

Competitors

Valuation

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Metric
UNH
CNC
CI
Price/Earnings (Normalized)
 22.029.9711.30
Price/Book Value
 5.861.491.69
Price/Sales
 1.400.260.41
Price/Cash Flow
 19.027.999.69
Price/Earnings
UNH
CNC
CI

Financial Strength

Metric
UNH
CNC
CI
Quick Ratio
 0.720.98—
Current Ratio
 0.801.12—
Interest Coverage
 10.216.055.71
Quick Ratio
UNH
CNC
CI

Profitability

Metric
UNH
CNC
CI
Return on Assets (Normalized)
 8.57%4.77%4.73%
Return on Equity (Normalized)
 28.55%15.51%15.44%
Return on Invested Capital (Normalized)
 16.83%9.46%9.68%
Return on Assets
UNH
CNC
CI

Healthcare Plans Industry Comparables

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Morningstar Rating for Stocks
Economic Moat
Market Cap
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Elevance Health IncBgwgts$109.3 Bil
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CVS Health CorpXkkjhf$86.1 Bil
CI
The Cigna GroupQxhlt$76.9 Bil
HUM
Humana IncQmgxsp$59.4 Bil
CNC
Centene CorpFdrbjf$37.7 Bil
MOH
Molina Healthcare IncYflkbzw$20.5 Bil
OSCR
Oscar Health Inc Class ACwkc$1.9 Bil
ALHC
Alignment Healthcare IncRrg$1.4 Bil
CLOV
Clover Health Investments Corp Ordinary Shares - Class AQzgm$452.7 Mil