On Tuesday, UnitedHealth Group UNH reported better-than-expected revenue and earnings in the first quarter as it still deals with the cyberattack on its subsidiary Change Healthcare in February this year.
The company reported adjusted EPS of $6.91, up from $6.26 a year ago, beating the consensus of $6.62.
UnitedHealth’s revenues increased nearly $8 billion to $99.8 billion, beating the consensus of $99.3 billion.
UnitedHealth maintained its adjusted EPS guidance of $27.50-$28.00.
Piper Sandler writes that UnitedHealth begins 2024 cautiously after a tough 2023, focusing on controlled growth, well-designed benefits, careful healthcare delivery, and efficient documentation.
Despite missing the medical cost ratio target attributed to changes, underlying medical costs remained stable and manageable as forecasted. The Piper analyst raised the price target to $571 from $566, with an Overweight rating, reflecting a consistent earnings-per-share estimate for 2025.
Truist is optimistic about UnitedHealth after its first-quarter results, which showed strong core trends and care patterns that align with expectations.
Although recovery after the cyberattack on Change Healthcare is ongoing, most of its functionality and services have been restored, and suspended utilization management programs are back.
UnitedHealth’s scale and resources have been crucial in this process. Normalized cash flow was strong, underscoring UnitedHealth’s financial flexibility.
Truist has adjusted its earnings per share estimates for 2024 and 2025, reiterating a Buy rating with a $600 price target.
Goldman Sachs analyst writes that overall, the positive medical cost update and a prudent outlook should help to ease investor concerns on utilization risk to UnitedHealth’s EPS in 2024.
Goldman Sachs maintains the Buy rating with a price target of $593.
Price Action: UNH shares are up 2.26% at $479.58 on the last check Wednesday.
Photo Courtesy of United health
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