J.P. Morgan Maintains Overweight on UnitedHealth Group (UNH)

J.P. Morgan maintains its Overweight rating on UnitedHealth Group UNH, after UNH reported Q4 EPS. In a note to clients, J.P. Morgan writes, "Yesterday UNH reported 4Q at $0.94, well ahead of the outlook, the report including a $0.12-0.13/share charge for goodwill write-off (ex this, would be about $1.06). Our December 2011 price target is $44/share share, this based on an 11x multiple to our 2012 earnings estimate, and compared to our group average 2012 P/E objective of 11x. Among the factors impacting our outlook are a more diversified earnings profile than most, with a credible and expanding weighting to faster growing and less regulated health-related service (non-insurance) businesses and improving commercial health benefits results. Creating some offset, UNH does have more exposure to Medicare Advantage than the average large cap, this representing about 25% of our premium revenue outlook, though we consider as still reasonably well diversified overall. We therefore rate UnitedHealth Overweight." UNH closed yesterday at $40.31.