UnitedHealth was already making headlines in 2025. The blue chip—and largest US health insurer, accounting for roughly 30% of Medicare Advantage enrollments—has been seeing higher medical claims. Investors started worrying about thinning margins and the potential need to raise insurance premiums.
But here’s the problem: recent 2027 Medicare Advantage plans will rise by just 0.09%, far lower than the expected 6%. This means premiums (i.e., revenue) can’t rise while costs keep climbing. The business simply isn’t as lucrative as before. It dragged many health insurer stocks down.
Finally the stock looks undervalued based on our estimated fair price of $372. But our concern is that with meek revenue growth outlook, declining profitability, and restructuring adding uncertainties, we don’t expect the stock to rebound meaningfully over the next two years. It could be a laggard for a while.
UnitedHealth’s results didn’t inspire confidence either. Revenue came in 2% lower year-over-year as restructuring continues under the new management—and below expectations. Costs have crept up to a point that profits were a mere $10 million, compared to $5.54 billion a year ago. Even excluding one-off restructuring costs, profits are still down by more than half.
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- JoanneSamson·02-02 09:56Feel ya, mate. Numbers look grim, no rebound in sight. [惊讶]LikeReport