4) UnitedHealth Group Incorporated (NYSE:UNH)
10-Year Revenue Growth Rate: ~11.8%
10-Year Net Income Growth Rate: ~9.9%
Number of Hedge Fund Holdings: 114
UnitedHealth Group Incorporated (NYSE:UNH) operates as a diversified healthcare company in the US.
Wall Street believes that UnitedHealth Group Incorporated (NYSE:UNH)’s growth trajectory is expected to be aided by its scale, diverse business segments, and integrated healthcare services. Moreover, the company’s wide network of healthcare providers and technological capabilities should further strengthen its competitive advantages. The company has a strong position in the healthcare market, primarily in the Medicare Advantage (MA) segment. UnitedHealth Group Incorporated (NYSE:UNH)’s scale and analytics capabilities should drive market share gains in government insurance markets.
Wall Street analysts expect that the company has numerous levers for potential upside in 2025, such as SG&A efficiencies, improvement in Optum health run rate margins, and a conservative bid strategy for Medicare Advantage Medical Loss Ratio (MA MLR). Any expansion of Medicare Advantage or higher government focus on value-based care should further build UnitedHealth Group Incorporated (NYSE:UNH)’s strengths.
UnitedHealth Group Incorporated (NYSE:UNH)’s Optum segment, which is engaged in providing health services and technology solutions, might see higher demand if policies encourage greater integration of care delivery and data analytics.
Analysts at Jefferies Financial Group upgraded the shares of UnitedHealth Group Incorporated (NYSE:UNH) from a “Hold” rating to a “Buy” rating, increasing the target price from $481.00 to $647.00 on 17th July. Wedgewood Partners, an investment management company, released its Q3 2024 investor letter. Here is what the fund said:
“UnitedHealth Group Incorporated (NYSE:UNH) shares rebounded during the quarter and the holding was a top contributor to portfolio performance. The Company reported double-digit growth in earnings per share during the quarter. It has been able to adjust pricing in its Healthcare segment to keep up with medical cost inflation while working with its Optum units to deliver more value-based care, replacing the traditional fee-for-service health-care model. The Optum segment grew operating income over +15% on strong expense management and continued uptake of value-based care offerings. Value-based care is a sensible, long-term growth opportunity for the Company to pursue and also differentiates them from the vast majority of healthcare providers, particularly as it relates to Medicare patients. For example, the Company’s value-based care programs provide more preventative care opportunities and homebased care visits for patients which helps save the U.S. health-care system billions in unnecessary spending, while also providing patients with better outcomes because diseases and behaviors are caught or corrected at earlier stages. Furthermore, the Company has invested in several core assets over the years in order to execute this value-based strategy. It may well become the standard of care as the proportion of people in the U.S. with healthcare insurance coverage continues to reach new highs.”
