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UnitedHealth (UNH) Beats on Q4 Earnings Excluding Tax Impact

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Have you been eager to see how UnitedHealth Group Inc. (UNH - Free Report) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this Minnetonka-based major health insurer’s earnings release this morning:

An Earnings Beat

UnitedHealth came out with earnings of $2.59 per share, which beat the Zacks Consensus Estimate of $2.50. Earnings also rose 22.7% year over year.

Improved revenues and higher enrollment primarily drove earnings beat.

Earnings Surprise History

UnitedHealth has an impressive earnings surprise history. Before posting the earnings beat in Q4, the company delivered positive surprises in all prior four quarters, as shown in the chart below:

UnitedHealth Group Incorporated Price and EPS Surprise

UnitedHealth Group Incorporated Price and EPS Surprise | UnitedHealth Group Incorporated Quote

Overall, the company has a positive earnings surprise of 4.4% in the trailing four quarters.

Revenue Higher Than Expected

UnitedHealth recorded revenues of $52.1 billion, which surpassed the Zacks Consensus Estimate of $51.5 billion. Also, it compared favorably with the year-ago number of $47.5 billion.

Key Stats for Q4:

  • Total operating cost of $48.1 billion increased 8.4% year over year.
  • Net margin of 6.9% increased from 3.5% in the year ago quarter.
  • The company medical enrollment grew to 49.5 million from 48.9 million in the year ago quarter.

Guidance Update

UnitedHealth revised its 2018 financial outlook to reflect the effects of the U.S. corporate tax law changes. It now expects 2018 net earnings of $11.65 to $11.95 per share and adjusted net earnings of $12.30 to $12.60 per share. Cash flows from operations are expected to range from $15 billion to $15.5 billion.

What Zacks Rank Says

UnitedHealth carries a Zacks Rank #3 (Hold). However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. While things apparently look favorable, it all depends on what sense the just-released report makes to the analysts.

(You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.)

Check back later for our full write up on this UnitedHealth earnings report!

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