In this article, we discuss the top 5 health insurance stocks to buy. If you want to read our detailed analysis of these companies, go directly to the Top 10 Health Insurance Stocks to Buy.
5. UnitedHealth Group Incorporated (NYSE: UNH)
Number of Hedge Fund Holders: 89
UnitedHealth Group Incorporated (NYSE: UNH) is a Minnesota-based health insurer founded in 1977. It is placed fifth on our list of top 10 health insurance stocks to buy. UnitedHealth stock has offered investors returns of more than 41% over the past year. The company has several business to business and business to consumer insurance plans and the firm also works with governmental agencies to provide healthcare to underprivileged individuals. It also has a partnership with the University of California to expand mental health services in the state.
On May 19, investment advisory Wells Fargo initiated coverage on UnitedHealth Group Incorporated (NYSE: UNH) stock with an Overweight rating and a price target of $478, implying a close to 17% upside potential.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Eagle Capital Management is a leading shareholder in UnitedHealth Group Incorporated (NYSE: UNH) with 3.2 million shares worth more than $1,2 billion.
Just like Humana Inc. (NYSE: HUM) and CVS Health Corporation (NYSE: CVS), UnitedHealth Group Incorporated (NYSE: UNH) is a top health insurance stock to buy.
In its Q1 2021 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and UnitedHealth Group Incorporated (NYSE: UNH) was one of them. Here is what the fund said:
“Shares of UnitedHealth Group Incorporated reacted positively to more favorable 2021 guidance than previewed at the company’s December 2020 investor day. Medical costs returned to a seasonal baseline, inclusive of COVID-19-related impacts. We consider UnitedHealth a core holding and a way to play positive demographic, population health, and value-based reimbursement trends. Despite its size, we think the company can grow earnings at a mid-teens rate over the long-term.”
4. AbbVie Inc. (NYSE: ABBV)
Number of Hedge Fund Holders: 72
AbbVie Inc. (NYSE: ABBV) is a Delaware-based healthcare firm founded in 2013. It is ranked fourth on our list of top 10 health insurance stocks to buy. AbbVie stock has returned more than 26% to investors over the past twelve months. The firm focuses on the development and marketing of biopharma products but also has stakes in an elaborate health insurance business. The firm has so far developed therapy drugs for several ailments. It was formed as a spin-off of Abbott Laboratories.
On April 30, AbbVie Inc. (NYSE: ABBV) posted earnings results for the first quarter of 2021, reporting a net revenue of over $13 billion, up 50% year-on-year, and earnings per share of $2.95, beating market estimates by $0.12.
3. CVS Health Corporation (NYSE: CVS)
Number of Hedge Fund Holders: 62
CVS Health Corporation (NYSE: CVS) is a Rhode Island-based healthcare company founded in 1963. It is placed third on our list of top 10 health insurance stocks to buy. CVS Health stock has returned more than 41% to investors over the past year. The firm has stakes in many healthcare-related businesses, including pharmacies. It owns and operates the CVS Pharmacy, a retail pharmacy chain, as well as the CVS Caremark, a pharmacy benefits manager. Aetna, a health insurance provider, is also owned by CVS Health Corporation.
CVS Health Corporation (NYSE: CVS) posted first quarter 2021 results on May 4, reporting earnings per share of $2.04 that beat market predictions by $0.32. The revenue for the first three months of the year was $69 billion, up 3.5% year-on-year.
Out of the hedge funds being tracked by Insider Monkey, Chicago-based firm Harris Associates is a leading shareholder in CVS Health Corporation (NYSE: CVS) with 8.5 million shares worth more than $643 million.
In its Q1 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and CVS Health Corporation (NYSE: CVS) was one of them. Here is what the fund said:
“We sold our position in CVS Health Corp. to allocate capital to companies with larger margins of safety. During the five years that we owned CVS Health Corp., the company acquired Aetna. At the time, we also owned Aetna, and we believed the combination of the two companies would create additional value. After the acquisition, its business performance has been disappointing. We reevaluated our assumptions and determined its value has not grown.”
2. Teladoc Health, Inc. (NYSE: TDOC)
Number of Hedge Fund Holders: 42
Teladoc Health, Inc. (NYSE: TDOC) is a New York-based telehealth firm founded in 2002. It is ranked sixth on our list of top 10 health insurance stocks to buy. Some of the brands it owns include Teladoc, Livongo, Advance Medical, Best Doctors, BetterHelp, and HealthiestYou, among others. In addition to telehealth, the company markets chronic condition management, expert medical services, behavioral health solutions, as well as guidance and support, and platform and program services.
In an interview with American news media earlier this month, Teladoc Health, Inc. (NYSE: TDOC) CEO Jason Gorevic said that virtual healthcare was not just an at-home phenomenon but was here to stay beyond the pandemic.
In its Q4 2020 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Teladoc Health, Inc. (NYSE: TDOC) was one of them. Here is what the fund said:
“Teladoc Health offers remote physician access to patients at home. After experiencing incredible levels of growth throughout the early stages of the pandemic as its unique value proposition rose to the forefront of the healthcare industry, the firm’s shares cooled off a bit as optimistic vaccine data slightly curtailed investor expectations for the firm’s future growth potential. We sold the stock.
1. Molina Healthcare, Inc. (NYSE: MOH)
Number of Hedge Fund Holders: 31
Molina Healthcare, Inc. (NYSE: MOH) is a California-based healthcare company founded in 1980. It is placed first on our list of top 10 health insurance stocks to buy. Molina stock has returned more than 40% to investors over the past year. The firm primarily provides health insurance to people through government programs like Medicaid and Medicare. It operates in more than 15 states and has more than 4 million members availing health plans through these two government initiatives.
On April 28, Molina Healthcare, Inc. (NYSE: MOH) reported earnings per share of $4.44 and a revenue of over $6 billion for the first quarter of 2021. The earnings per share beat market expectations by $0.73.
Out of the hedge funds being tracked by Insider Monkey, New York-based firm Renaissance Technologies is a leading shareholder in Molina Healthcare, Inc. (NYSE: MOH) with 2.4 million shares worth more than $576 million.
Just like UnitedHealth Group Incorporated (NYSE: UNH), CVS Health Corporation (NYSE: CVS), and Humana Inc. (NYSE: HUM), Molina Healthcare, Inc. (NYSE: MOH) is a top health insurance stock to buy.
You can also take a peek at Billionaire Izzy Englander’s Top 10 Stock Picks and Billionaire David Abrams’ Top Stock Picks.
