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

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UnitedHealth Group (UNH) closed at $429.71 in the latest trading session, marking a +0.43% move from the prior day. This change lagged the S&P 500's 0.81% gain on the day.

Heading into today, shares of the largest U.S. health insurer had gained 2.92% over the past month, lagging the Medical sector's gain of 3.51% and the S&P 500's gain of 3.51% 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 $4.46 per share, which would represent year-over-year growth of 27.07%. Meanwhile, our latest consensus estimate is calling for revenue of $71.37 billion, up 9.61% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $18.76 per share and revenue of $284.54 billion. These totals would mark changes of +11.14% and +10.65%, respectively, from last 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. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.05% higher. UNH is currently a Zacks Rank #3 (Hold).

Digging into valuation, UNH currently has a Forward P/E ratio of 22.81. For comparison, its industry has an average Forward P/E of 19.19, which means UNH is trading at a premium to the group.

It is also worth noting that UNH currently has a PEG ratio of 1.72. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. UNH's industry had an average PEG ratio of 1.12 as of yesterday's close.

The Medical - HMOs industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 77, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow UNH in the coming trading sessions, be sure to utilize Zacks.com.


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