UnitedHealth Group CEO shot dead in Manhattan, stock up 27% on strong earnings

From Nasdaq: 2024-12-05 23:19:10

UnitedHealth Group lost CEO Brian Thompson in a targeted shooting in Manhattan during its investor day. Despite cyberattack impact, UNH stock rose 27% to $610, driven by a 42% rise in adjusted earnings to $27.02. OptumHealth’s strong growth offset UnitedHealth’s insurance segment struggles, leading to improved margins and bottom line.

The rise in UnitedHealth’s revenue was fueled by OptumHealth’s 76% growth between 2021 and 2023. However, rising medical costs and procedures impacted the company’s insurance business and stock performance. Despite revenue growth and margin improvement, UnitedHealth’s P/E ratio fell due to concerns about profitability, leading to a decline in stock performance.

UNH stock’s 17% gains this year underperformed the S&P 500, with returns of 45% in 2021, 7% in 2022, and 1% in 2023. Uncertainty around rate cuts and rising medical costs could impact UNH’s performance. The company’s valuation is estimated at $606 per share based on 22x trailing adjusted earnings, aligning with current levels at $610.

While UNH stock appears fully valued, comparing UnitedHealth Group with its peers can provide valuable insights. The company’s returns in December 2024 show 17% month-to-date and 17% year-to-date gains, totaling 328% since 2017. Peer comparisons can offer additional context on UNH’s performance in the industry.



Read more at Nasdaq: What’s Happening With UNH Stock?