UnitedHealth Group Incorporated’s (UNH - Free Report) Brazil unit received acquisition proposals from several investors, per Bloomberg. Nelson Tanure presented an offer, valuing the unit at $509-$610 million. Jose Seripieri Filho and Bian Capital also made proposals, people acquainted with the matter said. The decision on the divestment deal is expected to be disclosed soon.
This move bodes well for UNH, as divesting unprofitable assets or businesses will bring cash influx and enhance its capital efficiency in the future. UNH acquired the Brazil unit — Amil Participacoes SA — for $4.7 billion in 2012. The company also previously made efforts to sell the unit, per reports.
Amil’s individual health insurance portfolio is witnessing rising losses, which is concerning. In 2021, an attempt to sell this unit was revoked by the National Supplementary Health Agency — a regulatory agency in Brazil. Amil’s portfolio of individual plans, which consists of almost 320,000 users, is impacting UNH’s overall performance.
UNH’s sale of the Brazil division is expected to free up capital, thereby allowing it to focus on its more profitable assets and boost shareholder value. UNH expects acquisitions, dividends and share repurchases to contribute 3-5 percentage points to its annual EPS growth rate. Its efforts to streamline unprofitable operations are expected to aid it in achieving its 2024 adjusted net earnings target of $27.5-$28 per share.
UnitedHealth’s international business contributed less than 3% to its total revenues in 2022. The company is focused on growing in the United States, wherein almost 50% of the population is dependent on their employers for benefit coverage. Moreover, 19 million people get themselves insured through the individual market. The participation through ACA exchange has grown 50% in the past five years, highlighting an important market opportunity for UnitedHealth Group to grow. UNH expects to reach more customers through expansion and innovative consumer-centric products.
Shares of UnitedHealth Group have gained 9% in the past six months compared with the industry’s 8.2% growth. UNH currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks in the broader Medical space are Centene Corporation (CNC - Free Report) , Bausch Health Companies Inc. (BHC - Free Report) and Atai Life Sciences N.V. (ATAI - Free Report) . Each of these three companies presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Centene Corp’s 2023 earnings indicates a 15.1% year-over-year increase to $6.65 per share. The consensus mark for the company’s 2023 revenues indicates 4.4% growth from a year ago. CNC beat earnings estimates in two of the last four quarters and missed twice, the average surprise being 5.6%.
Bausch Health’s earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed the mark once, the average surprise being 0.04%. The consensus estimate for BHC’s 2023 earnings indicates a rise of 11.1% from the prior-year reported figure. The consensus mark for revenues suggests an improvement of 5.9% from the prior-year reported figure.
The Zacks Consensus Estimate for Atai Life Sciences’ current-year earnings implies a 68.4% improvement from the year-ago reported figure. It has witnessed four upward estimate revisions over the past 60 days against no movement in the opposite direction. ATAI beat earnings estimates in two of the last four quarters, met once and missed on one occasion, the average surprise being 3.2%.
Zacks Naming Top 10 Stocks for 2024
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History suggests their performance could be sensational.
From 2012 (when our Director of Research, Sheraz Mian assumed responsibility for the portfolio) through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2024. Don’t miss your chance to get in on these stocks when they’re released on January 2.
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UnitedHealth Group Incorporated’s (UNH - Free Report) Brazil unit received acquisition proposals from several investors, per Bloomberg. Nelson Tanure presented an offer, valuing the unit at $509-$610 million. Jose Seripieri Filho and Bian Capital also made proposals, people acquainted with the matter said. The decision on the divestment deal is expected to be disclosed soon.
This move bodes well for UNH, as divesting unprofitable assets or businesses will bring cash influx and enhance its capital efficiency in the future. UNH acquired the Brazil unit — Amil Participacoes SA — for $4.7 billion in 2012. The company also previously made efforts to sell the unit, per reports.
Amil’s individual health insurance portfolio is witnessing rising losses, which is concerning. In 2021, an attempt to sell this unit was revoked by the National Supplementary Health Agency — a regulatory agency in Brazil. Amil’s portfolio of individual plans, which consists of almost 320,000 users, is impacting UNH’s overall performance.
UNH’s sale of the Brazil division is expected to free up capital, thereby allowing it to focus on its more profitable assets and boost shareholder value. UNH expects acquisitions, dividends and share repurchases to contribute 3-5 percentage points to its annual EPS growth rate. Its efforts to streamline unprofitable operations are expected to aid it in achieving its 2024 adjusted net earnings target of $27.5-$28 per share.
UnitedHealth’s international business contributed less than 3% to its total revenues in 2022. The company is focused on growing in the United States, wherein almost 50% of the population is dependent on their employers for benefit coverage. Moreover, 19 million people get themselves insured through the individual market. The participation through ACA exchange has grown 50% in the past five years, highlighting an important market opportunity for UnitedHealth Group to grow. UNH expects to reach more customers through expansion and innovative consumer-centric products.
Shares of UnitedHealth Group have gained 9% in the past six months compared with the industry’s 8.2% growth. UNH currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks in the broader Medical space are Centene Corporation (CNC - Free Report) , Bausch Health Companies Inc. (BHC - Free Report) and Atai Life Sciences N.V. (ATAI - Free Report) . Each of these three companies presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Centene Corp’s 2023 earnings indicates a 15.1% year-over-year increase to $6.65 per share. The consensus mark for the company’s 2023 revenues indicates 4.4% growth from a year ago. CNC beat earnings estimates in two of the last four quarters and missed twice, the average surprise being 5.6%.
Bausch Health’s earnings outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missed the mark once, the average surprise being 0.04%. The consensus estimate for BHC’s 2023 earnings indicates a rise of 11.1% from the prior-year reported figure. The consensus mark for revenues suggests an improvement of 5.9% from the prior-year reported figure.
The Zacks Consensus Estimate for Atai Life Sciences’ current-year earnings implies a 68.4% improvement from the year-ago reported figure. It has witnessed four upward estimate revisions over the past 60 days against no movement in the opposite direction. ATAI beat earnings estimates in two of the last four quarters, met once and missed on one occasion, the average surprise being 3.2%.
Zacks Naming Top 10 Stocks for 2024
Want to be tipped off early to our 10 top picks for the entirety of 2024?
History suggests their performance could be sensational.
From 2012 (when our Director of Research, Sheraz Mian assumed responsibility for the portfolio) through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2024. Don’t miss your chance to get in on these stocks when they’re released on January 2.
Be First to New Top 10 Stocks >>
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