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UnitedHealth Q1 Earnings Beat Estimates on Rising Premiums
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Key Takeaways
UnitedHealth reported Q1 EPS of $7.23, beating estimates on strong commercial fee-based membership growth.
UNH saw revenues rise 2% to $111.7B, with premium growth and improved medical care ratio aiding results.
UNH's Optum revenues dipped slightly due to Optum Health weakness, while risk-based membership declined.
UnitedHealth Group Incorporated (UNH - Free Report) reported first-quarter 2026 adjusted earnings per share (EPS) of $7.23, which beat the Zacks Consensus Estimate of $6.46. The bottom line rose 0.4% year over year.
Revenues rose 2% year over year to $111.7 billion. The top line beat the consensus mark by 2.1%.
The strong quarterly earnings were aided by growth in commercial fee-based membership and the strength witnessed in Optum Rx. However, weakness in Optum Health and declining risk-based membership partially offset the positives.
UnitedHealth Group Incorporated Price, Consensus and EPS Surprise
UnitedHealth’s first-quarter premium of $87.6 billion increased from $86.5 billion a year ago and beat the consensus mark of $86.1 billion.
UNH’s adjusted medical care ratio (MCR) was 83.9% in the first quarter, which improved 90 bps from the year-ago period. The metric was lower than the Zacks Consensus Estimate of 85.7%. MCR witnessed a decrease due to solid medical cost management and favorable reserve development. Medical costs of $73.5 billion rose from $73.4 billion a year ago.
First-quarter total operating costs of $102.7 billion increased 2.3% year over year due to higher medical costs and operating costs. The figure came higher than our model estimate of $101.5 billion. The first-quarter 2026 operating cost ratio deteriorated to 13.8% from 12.4% a year ago.
UnitedHealth’s adjusted operating earnings declined 1.7% year over year to $9 billion in the first quarter.
UNH’s Business Platforms
Revenues of the health benefits business of UnitedHealth, UnitedHealthcare, rose 1.9% year over year to $86.3 billion in the first quarter. The metric beat the Zacks Consensus Estimate of $85.1 billion and our estimate of $84.4 billion. The UnitedHealthcare business catered to 49.1 million people as of March 31, 2026, which fell 2.1% year over year. However, the figure beat the Zacks Consensus Estimate of 48.1 million.
Adjusted earnings from operations amounted to $5.7 billion, up from $5.2 billion a year ago. The adjusted operating margin increased to 6.6% from 6.2% a year ago.
Revenues in the Optum business line were $63.7 billion, which fell from $63.9 billion a year ago due to lower contributions from Optum Health. However, the figure surpassed the consensus mark of $61.6 billion. Optum’s adjusted earnings from operations declined to $3.3 billion from $3.9 billion a year ago. The adjusted operating margin of 5.1% decreased from 6.1%.
UNH’s Financial Position (As of March 31, 2026)
UnitedHealth exited the first quarter with cash and short-term investments of $31.2 billion, which rose from the 2025-end level of $28.1 billion. Total assets of $312.6 billion increased from the $309.6 billion figure at 2025-end.
Long-term debt, less current maturities, amounted to $71.4 billion, down from the $72.3 billion figure as of Dec. 31, 2025. Short-term borrowings and the current maturities of long-term debt were $6.5 billion.
Total equity of $103.9 billion advanced from the 2025-end level of $100.1 billion.
UnitedHealth generated operating cash flows of $8.9 billion in the first quarter of 2026, which grew from the prior-year figure of $5.5 billion. In the first quarter of 2026, it paid dividends worth $2 billion.
UNH’s Revised 2026 Outlook
Management earlier projected revenues for 2026 above $439 billion, which are below the 2025 level due to planned right-sizing across operations. Adjusted EPS is now expected to be more than $18.25 for 2026, up from the previous guidance of at least $17.75, indicating improving margins. It is higher than the Zacks Consensus Estimate of $17.66. Net margin was expected to be around 3.6%, up from 2.7% in 2025.
The company earlier expected MCR to be 88.8% (± 50 bps) in 2026, down from 89.1% in 2025, while the operating cost ratio was likely to be 12.8% (± 50 bps). The tax rate was expected to be around 19.25%.
Operating cash flows were estimated to be $18 billion, down from the 2025 level. UNH is expected to make repurchases of $2.5 billion and pay dividends worth $8 billion in 2026. Capex was estimated at $3.8 billion for the year.
Furthermore, management earlier expected medical memberships to be within 46.945-47.495 million in 2026, with significant declines in commercial risk, Medicare Advantage and Medicaid heads.
The Zacks Consensus Estimate for Globus Medical’s current-year earnings of $4.46 per share has witnessed one upward revision in the past 30 days, against no movement in the opposite direction. Globus Medical beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 18.8%. The consensus estimate for current-year revenues is pegged at $3.2 billion, suggesting 8.7% year-over-year growth.
The Zacks Consensus Estimate for InnovAge Holding’s current-year earnings of 25 cents per share has witnessed one upward revision in the past 60 days, against no movement in the opposite direction. InnovAge Holding beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 87.5%. The consensus estimate for current-year revenues is pegged at $944.5 million, suggesting 10.6% year-over-year growth.
The Zacks Consensus Estimate for BrightSpring Health Services’ current-year earnings of $1.61 per share has witnessed six upward revisions in the past 60 days, against no movement in the opposite direction. BrightSpring Health Services beat earnings estimates in three of the trailing four quarters and missed once, with an average surprise of 40.4%. The consensus estimate for current-year revenues is pegged at $14.8 billion, suggesting 14.8% year-over-year growth.
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UnitedHealth Q1 Earnings Beat Estimates on Rising Premiums
Key Takeaways
UnitedHealth Group Incorporated (UNH - Free Report) reported first-quarter 2026 adjusted earnings per share (EPS) of $7.23, which beat the Zacks Consensus Estimate of $6.46. The bottom line rose 0.4% year over year.
Revenues rose 2% year over year to $111.7 billion. The top line beat the consensus mark by 2.1%.
The strong quarterly earnings were aided by growth in commercial fee-based membership and the strength witnessed in Optum Rx. However, weakness in Optum Health and declining risk-based membership partially offset the positives.
UnitedHealth Group Incorporated Price, Consensus and EPS Surprise
UnitedHealth Group Incorporated price-consensus-eps-surprise-chart | UnitedHealth Group Incorporated Quote
Q1 Business Performance of UNH
UnitedHealth’s first-quarter premium of $87.6 billion increased from $86.5 billion a year ago and beat the consensus mark of $86.1 billion.
UNH’s adjusted medical care ratio (MCR) was 83.9% in the first quarter, which improved 90 bps from the year-ago period. The metric was lower than the Zacks Consensus Estimate of 85.7%. MCR witnessed a decrease due to solid medical cost management and favorable reserve development. Medical costs of $73.5 billion rose from $73.4 billion a year ago.
First-quarter total operating costs of $102.7 billion increased 2.3% year over year due to higher medical costs and operating costs. The figure came higher than our model estimate of $101.5 billion. The first-quarter 2026 operating cost ratio deteriorated to 13.8% from 12.4% a year ago.
UnitedHealth’s adjusted operating earnings declined 1.7% year over year to $9 billion in the first quarter.
UNH’s Business Platforms
Revenues of the health benefits business of UnitedHealth, UnitedHealthcare, rose 1.9% year over year to $86.3 billion in the first quarter. The metric beat the Zacks Consensus Estimate of $85.1 billion and our estimate of $84.4 billion. The UnitedHealthcare business catered to 49.1 million people as of March 31, 2026, which fell 2.1% year over year. However, the figure beat the Zacks Consensus Estimate of 48.1 million.
Adjusted earnings from operations amounted to $5.7 billion, up from $5.2 billion a year ago. The adjusted operating margin increased to 6.6% from 6.2% a year ago.
Revenues in the Optum business line were $63.7 billion, which fell from $63.9 billion a year ago due to lower contributions from Optum Health. However, the figure surpassed the consensus mark of $61.6 billion. Optum’s adjusted earnings from operations declined to $3.3 billion from $3.9 billion a year ago. The adjusted operating margin of 5.1% decreased from 6.1%.
UNH’s Financial Position (As of March 31, 2026)
UnitedHealth exited the first quarter with cash and short-term investments of $31.2 billion, which rose from the 2025-end level of $28.1 billion. Total assets of $312.6 billion increased from the $309.6 billion figure at 2025-end.
Long-term debt, less current maturities, amounted to $71.4 billion, down from the $72.3 billion figure as of Dec. 31, 2025. Short-term borrowings and the current maturities of long-term debt were $6.5 billion.
Total equity of $103.9 billion advanced from the 2025-end level of $100.1 billion.
UnitedHealth generated operating cash flows of $8.9 billion in the first quarter of 2026, which grew from the prior-year figure of $5.5 billion. In the first quarter of 2026, it paid dividends worth $2 billion.
UNH’s Revised 2026 Outlook
Management earlier projected revenues for 2026 above $439 billion, which are below the 2025 level due to planned right-sizing across operations. Adjusted EPS is now expected to be more than $18.25 for 2026, up from the previous guidance of at least $17.75, indicating improving margins. It is higher than the Zacks Consensus Estimate of $17.66. Net margin was expected to be around 3.6%, up from 2.7% in 2025.
The company earlier expected MCR to be 88.8% (± 50 bps) in 2026, down from 89.1% in 2025, while the operating cost ratio was likely to be 12.8% (± 50 bps). The tax rate was expected to be around 19.25%.
Operating cash flows were estimated to be $18 billion, down from the 2025 level. UNH is expected to make repurchases of $2.5 billion and pay dividends worth $8 billion in 2026. Capex was estimated at $3.8 billion for the year.
Furthermore, management earlier expected medical memberships to be within 46.945-47.495 million in 2026, with significant declines in commercial risk, Medicare Advantage and Medicaid heads.
UNH’s Zacks Rank & Key Picks
UNH currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are Globus Medical, Inc. (GMED - Free Report) , InnovAge Holding Corp. (INNV - Free Report) and BrightSpring Health Services, Inc. (BTSG - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Globus Medical’s current-year earnings of $4.46 per share has witnessed one upward revision in the past 30 days, against no movement in the opposite direction. Globus Medical beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 18.8%. The consensus estimate for current-year revenues is pegged at $3.2 billion, suggesting 8.7% year-over-year growth.
The Zacks Consensus Estimate for InnovAge Holding’s current-year earnings of 25 cents per share has witnessed one upward revision in the past 60 days, against no movement in the opposite direction. InnovAge Holding beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 87.5%. The consensus estimate for current-year revenues is pegged at $944.5 million, suggesting 10.6% year-over-year growth.
The Zacks Consensus Estimate for BrightSpring Health Services’ current-year earnings of $1.61 per share has witnessed six upward revisions in the past 60 days, against no movement in the opposite direction. BrightSpring Health Services beat earnings estimates in three of the trailing four quarters and missed once, with an average surprise of 40.4%. The consensus estimate for current-year revenues is pegged at $14.8 billion, suggesting 14.8% year-over-year growth.