UnitedHealth (UNH) Stock Pops on Raised Outlook

  • UnitedHealth (UNH) stock is trending this morning after the company reported solid earnings.
  • The company also raised its outlook for the third-straight quarter.
  • UNH stock is rallying several percentage points in response to the positive news.
The UnitedHealth (UNH) headquarters in Minnetonka, Minnesota.
Source: Ken Wolter / Shutterstock.com

Health care insurer UnitedHealth (NYSE:UNH) just released its third-quarter financial results. Now, UNH stock is catching a bid. Not only did earnings beat Wall Street’s forecasts, UnitedHealth also raised its earnings outlook for the third consecutive quarter.

Despite high inflation, it appears that UnitedHealth continued to be profitable during Q3. RBC Capital Markets analyst Ben Hendrix called the most recent results “solid.”

Let’s get down to the nitty-gritty. For the quarter, UnitedHealth posted year-over-year (YOY) revenue growth of 12% to $80.9 billion. This represents a slight beat compared to the analyst consensus estimate of $80.3 billion.

In terms of revenue generation, a particularly strong point for UnitedHealth was its data-optimized Optum segment. The unit provided $46.6 billion in quarterly revenue compared to $39.8 billion in the prior-year quarter.

Turning to the bottom-line results, UnitedHealth posted quarterly adjusted earnings of $5.79 per share. This result outdid the Wall Street forecast of $5.43 per share.

What’s Happening With UNH Stock?

This morning, the major stock market indices were down but UNH stock remained up. Bucking the broader market trend, UnitedHealth shareholders are currently pushing the price up 2% for the day.

Speaking of bucking the trend, it’s impressive that UnitedHealth managed to post such solid quarterly results during a time of high inflation. The company grew its Q3 2022 earnings from operations 31% YOY to $7.5 billion.

Looking ahead, UnitedHealth raised its adjusted earnings guidance for fiscal 2022 from the previous estimate of between $21.40 and $21.90 per share to between $21.85 and $22.05 per share.

It’s also notable that the company is serving more people. Specifically, the total people served domestically by UnitedHealth has “grown by approximately 850,000 in 2022.” This includes the 185,000 people added in Q3.

Clearly, UnitedHealth is doing something right and UNH stock investors deserve a nice, green day. Plus, there are broader implications here. The company’s success seems to show that, just maybe, the health care sector can thrive despite the cost of almost everything going up this year.

On the date of publication, David Moadel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

Article printed from InvestorPlace Media, https://investorplace.com/2022/10/unitedhealth-unh-stock-pops-on-raised-outlook/.

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