UNH Stock Recent News

The February hack at UnitedHealth's Change Healthcare unit affected the data of 100 million people, the U.S. health department's website showed, making it the largest data breach in the country.

UnitedHealth (UNH) has been one of the stocks most watched by Zacks.com users lately. So, it is worth exploring what lies ahead for the stock.

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On October 15, UnitedHealth Group published financial results for the third quarter of 2024, which surprised me primarily due to the sharp increase in Optum Rx revenue. Optum Rx's revenue reached about $34.2 billion in the third quarter of 2024, up 18.5% year-on-year. Overall, due to year-over-year revenue growth in UnitedHealth Group's two main divisions, Optum and UnitedHealthcare, it repurchased shares worth $1.7 billion in Q3 2024.

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Looking ahead to 2025, UNH projects adjusted earnings to reach around $30 per share at the top end, which falls short of the Zacks Consensus Estimate.

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The market has over-reacted to UNH's cautious FY2025 guidance, since the lower bottom-line is attributed to "CMS payment cuts, the IRA, and a mismatch between Medicaid rates and medical program." Given the recently released Star rating for 2025, we believe that the redeterminations and higher medical costs may be a new normal across the health care provider industry. For now, UNH has attempted to optimize its operations while managing the Optum therapy/ drug costs, resulting in the segment's growing profit margins and decent FY2024 guidance.

UnitedHealth Group's UNH stock price pulled back following the Q3 earnings release in what can best be described as a temper tantrum. The results weren't bad, outpacing the consensus estimates and compounded by solid guidance, but the market wanted more, so it sold off.