We recently compiled a list of the Jim Cramer is Talking About These 14 Stocks Before Earnings. In this article, we are going to take a look at where UnitedHealth Group Incorporated (NYSE:UNH) stands against the other stocks Jim Cramer is talking about before earnings.
As earnings season kicks off, Jim Cramer of Mad Money offered insights on what investors should watch in the coming week on Wall Street. He highlighted the anticipated reports from several major banks, along with a few other companies, as key events to monitor.
Cramer expressed optimism about the current market conditions, noting that the situation aligns with his previous predictions that the market would thrive once the Federal Reserve began reducing interest rates while the economy remained strong. He remarked on the spectacular earnings reported by some major banks on Friday, emphasizing that this positive news is particularly impactful now, as opposed to previous instances when the Fed was tightening, causing good news to go largely unnoticed. Cramer believes that with the Fed now supportive of the market, there is potential for more favorable times ahead.
Looking to Monday, Cramer predicted that the focus will shift away from earnings reports due to other significant developments over the weekend. He mentioned the anticipated unveiling of a Chinese stimulus package and noted that although the rally in China has stalled, it could regain momentum if the Chinese government injects substantial funds into real estate and the stock market.
“Now, on Monday, we won’t be focused on earnings. There’s a lot of other stuff happening over the weekend. For instance, I think we’ll be parsing the Chinese stimulus package that’s going to be unveiled. The China rally is stalled, but it can get rolling again if the Chinese Communist Party keeps throwing tens of billions of dollars for the stimulus at real estate, at the stock market.”
Cramer warned that the financial sector will face a significant test on Tuesday, as different banks will be reporting their earnings. Cramer reminded investors that we are just at the beginning of one of the year’s four reporting periods, which can be chaotic and open to various interpretations.
“We’re at the beginning of one of the year’s four reporting periods,” he said. “They’re jumbled. They’re open to a lot of interpretation. They’re fast. So listen to the calls, ponder a moment, and only then should you pull the trigger.”
Our Methodology
For this article, we compiled a list of 14 stocks that are slated to release earnings this week and were discussed by Cramer during his episode of Mad Money on October 11. We listed the stocks in ascending order of their hedge fund sentiment as of the second quarter, which was taken from Insider Monkey’s database of more than 900 hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A senior healthcare professional giving advice to a patient in a clinic.
UnitedHealth Group Incorporated (NYSE:UNH)
Number of Hedge Fund Holders: 114
Cramer talked about UnitedHealth Group Incorporated (NYSE:UNH) during Mad Money and highlighted that the company beats earnings routinely. Here’s what he had to say:
“We have United Health Group, and this Dow component just doesn’t miss. UNH is the only health insurer that regularly beats earnings. Nothing’s clockwork in this business. But when this one misses, the stock barely goes down, and when it beats, the gains are huge. Interesting risk-reward, huh?”
UnitedHealth Group (NYSE:UNH) operates as a diversified healthcare organization and offers a range of services and products. Through its UnitedHealthcare segment, the company delivers health insurance and benefits to millions of individuals in the United States, as well as to over 2 million people in South America. Meanwhile, the Optum segment offers healthcare and pharmacy services to more than 100 million individuals and provides technological support to hospitals and other healthcare providers.
UnitedHealth Group (NYSE:UNH) updated its earnings outlook for the full year of 2024, projecting net earnings in the range of $15.95 to $16.40 per share. The adjustment accounts for the reclassification of its remaining South American operations as held for sale, as well as the anticipated impacts of the cyberattack on Change Healthcare. The company completed the sale of its larger Brazilian operations during the first quarter of 2024, marking a significant transition in its South American presence.
In a move to strengthen its portfolio, the company acquired the home-health business LHC Group last year and is in the process of finalizing the acquisition of Amedisys, which also focuses on home health services. The expansion into home health shows that the company is looking to expand its service offerings. The company expects that its earnings could grow at a rate of 13% to 16% annually over the long term. Continued acquisitions and the expansion of its Medicare business are expected to contribute significantly to the company’s sustained financial growth.
Overall UNH ranks 2nd on our list of the stocks Jim Cramer is talking about before earnings. While we acknowledge the potential of UNH as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than UNH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure: None. This article is originally published at Insider Monkey.