UnitedHealth Group Incorporated UNH announced that it plans to expand its coverage area and reach 96% of all Medicare customers with its 2024 Individual Medicare Advantage Plan. UNH aims to enhance its offerings with improved benefits, cost savings and broad network access.
This move bodes well for UNH, as it aims to expand its membership levels in the future. As the company begins to serve more Medicare customers, its premium revenues will improve eventually. We expect UNH’s premium revenues to increase 11% in 2023. The company will enhance its Ucard offering with a new mobile product scanner, an expanded retail network and opportunities to gain rewards. These will make it easier for Medicare customers to shop with their Ucard.
The company aims to add 700,000 more people to its Medicare Advantage plan in 110 new counties and 2.7 million more individuals to its Chronic Special Needs Plans. It will offer dental coverage with no deductible and $0 copays, which are not covered by original Medicare. UNH will also offer hearing and vision coverage, covering 2,000 hearing aids per-device copays from $99 to $1,249. This will benefit members, offering them savings over the average retail price. The open enrollment is likely to start from Oct 15 to Dec 7.
However, it is vital for UnitedHealth Group to increase its membership levels to witness improved top-line performance. Product enhancements, new introductions and expansion initiatives are expected to position the company well for the future. The company expects total revenues between $357 billion and $360 billion this year, the mid-point of which suggests 10.6% growth from the 2022 reported figure.
Shares of UnitedHealth Group have gained 4.3% in the past six months compared with the industry’s 3.7% growth. UNH currently carries a Zacks Rank #3 (Hold).
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Stocks to Consider
Some better-ranked stocks in the Medical space are Molina Healthcare, Inc. MOH, The Ensign Group, Inc. ENSG and Medpace Holdings, Inc. MEDP. Each of these companies presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The bottom line of Molina Healthcare surpassed estimates in each of the last four quarters, the average surprise being 7.2%. The Zacks Consensus Estimate for MOH’s 2023 earnings and revenues indicates 16% and 3.4% growth, respectively, from their corresponding prior-year actuals. The consensus mark for MOH’s 2023 earnings has moved 0.6% north in the past 60 days.
Ensign Group’s earnings beat estimates in two of the trailing four quarters, matched the mark once and missed on the remaining one occasion, the average surprise being 0.9%. The Zacks Consensus Estimate for ENSG’s 2023 earnings and revenues indicates 14.7% and 22.7% growth, respectively, from the prior-year actuals. The consensus mark for ENSG’s 2023 earnings has moved 0.2% north in the past 30 days.
Medpace’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 22.3%. The Zacks Consensus Estimate for MEDP’s 2023 earnings indicates a rise of 15.3%, while the consensus mark for revenues suggests an improvement of 27.8% from the corresponding year-ago reported figures. The consensus estimate for MEDP’s 2023 earnings has moved 2.1% north in the past 60 days.
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