UnitedHealth Group (UNH) stock is down more than 9% in early trading Tuesday, dragging the price-weighted Dow Jones Industrial Average into the red. The selloff comes as the health insurance company trimmed the top end of its full-year profit forecast, which is offsetting a third-quarter earnings beat.
In the three months ended September 30, UnitedHealth's revenue increased 9.1% year-over-year to $100.8 billion, thanks in part to a 7.1% jump in premiums to $77.4 billion. Its earnings per share (EPS) were up 9% from the year-ago period to $7.15.
"Our continued growth, which positions us well for the coming years, is rooted in the innovative products and responsive service of our people that are embraced each day across the full range of health care participants," said UnitedHealth CEO Andrew Witty in a statement.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
UNH's third-quarter results topped analysts' expectations. Wall Street was anticipating revenue of $99.3 billion and earnings of $7 per share, according to Yahoo Finance.
As a result of "business disruption impacts" from the data breach at its Change Healthcare unit earlier this year, UnitedHealth went on to revise its full-year profit forecast. It now anticipates EPS in the range of $27.50 to $27.75, with the top end of that guidance down from its previous forecast of $27.50 to $28.
Is UnitedHealth stock a buy, sell or hold?
Heading into Tuesday's trading, UnitedHealth Group stock was up 16.4% on a total return basis (price change plus dividends). While this lags the S&P 500's 24.2% gain, Wall Street remains bullish on the Dow Jones stock.
According to S&P Global Market Intelligence, the average analyst target price for UNH stock is $627.53, representing implied upside of more than 14% to current levels. Additionally, the consensus recommendation on the blue chip stock is a Strong Buy.
Financial services firm Truist Securities is one of the more bullish outfits on UNH stock with a Buy rating and $640 price target.
UnitedHealth has "highly integrated, complementary platforms benefiting from meaningful scale, diversification and robust capabilities complemented by a sizable balance sheet and significant cash flow generation," says Truist analyst David MacDonald. He adds that "core trends remain solid" despite the impact of the data breach at Change Healthcare.
Related content
-
Retire in Costa Rica With These Three Tax BenefitsRetirement Taxes Costa Rica may be a good place for retirement if you like the low cost of living and savings for your heirs.
-
Five Ways to Ease Caregiver StressCaregiver stress is real. Here are five techniques to protect your health and happiness while caring for a loved one.
-
Financial Strategies Borrowed From the Big Game's PlaybookLike the best football teams, you can win at financial planning by executing a strategy, making halftime adjustments and staying focused on the ultimate prize.
-
Three Ways to Plan Now for a Social Security Shortfall LaterThe outlook for Social Security is gloomy, but you can save now to protect against benefit cuts later. If the cuts don't happen, you'll still be better off.
-
Is It Too Late to Invest in Bitcoin?The price of the world's No. 1 cryptocurrency recently surpassed $100,000 for the first time. Is it too late to invest in bitcoin?
-
Extra Cash? Should You Pay Off Debt or Invest?Depending on your financial situation, you might benefit from paying off debt, investing or both. Here are some things to consider before deciding.
-
The Future of 1031 Exchanges Under Trump Looks BrightAs a real estate investor himself, President Trump appears poised to preserve the tax-deferring power of this strategy. But you still must follow the rules.
-
Gambling vs Investing: How to Tell the DifferenceIt's easy to get caught up in the excitement of placing a bet on the Big Game, but beware of letting that emotion drive your investing decisions.
-
Stock Market Today: Stocks Swing Lower as Inflation Fears RiseThe latest consumer sentiment data showed near-term inflation expectations rose to their highest level since November 2023.
-
January Jobs Report Keeps Rates on Pause: What the Experts Are SayingJobs Report Solid labor market conditions point to the Fed maintaining a cautious stance on borrowing costs.
