CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We lower our 12-month target $24 to $571, reflecting a 20.5x multiple of our 2024 EPS estimate (down $0.10 to $27.85), above UNH’s five- and 10-year averages of 19.6x and 18.4x, respectively, and a premium to managed health care peers. We start our 2025 estimate at $31.49. UNH reported Q4 adjusted EPS of $6.16 vs. $5.34, topping consensus by $0.17. Revenue of $94.4B (+14% Y/Y) beat consensus by roughly $2.2B, supported by growth in commercial and Medicare customers, offset some by fewer Medicaid customers given losses from the nationwide redetermination process. Patient growth and higher Rx volumes at Optum, as well as additions from the recently acquired Change Healthcare, also supported the quarterly beat. Margins declined as the Q4 medical cost ratio (MCR) was 85%, up from 82.8% in Q4 2022, with higher costs from outpatient care among seniors. 2023 MCR was 83.2%, up from 82% in 2022. UNH guides for about 84% in 2024, reflecting higher medical utilization and ongoing headwinds from a Medicare rate change.