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UnitedHealth Group (UNH) Dips More Than Broader Markets: What You Should Know

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UnitedHealth Group (UNH - Free Report) closed the most recent trading day at $336.11, moving -0.67% from the previous trading session. This change lagged the S&P 500's daily loss of 0.39%. Meanwhile, the Dow gained 0.12%, and the Nasdaq, a tech-heavy index, lost 0.1%.

Heading into today, shares of the largest U.S. health insurer had gained 0.41% over the past month, lagging the Medical sector's gain of 5.94% and the S&P 500's gain of 4.06% in that time.

Investors will be hoping for strength from UNH as it approaches its next earnings release. The company is expected to report EPS of $2.42, down 37.95% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $65.18 billion, up 7.02% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $16.78 per share and revenue of $256.80 billion, which would represent changes of +11.05% and +6.05%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for UNH. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.08% higher. UNH currently has a Zacks Rank of #3 (Hold).

In terms of valuation, UNH is currently trading at a Forward P/E ratio of 20.17. This valuation marks a premium compared to its industry's average Forward P/E of 17.3.

It is also worth noting that UNH currently has a PEG ratio of 1.6. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. UNH's industry had an average PEG ratio of 1.37 as of yesterday's close.

The Medical - HMOs industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 205, which puts it in the bottom 20% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow UNH in the coming trading sessions, be sure to utilize Zacks.com.


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