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UnitedHealth (UNH) Q2 Earnings Beat on Revenue Growth

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Have you been eager to see how UnitedHealth Group Inc. (UNH - Free Report) performed in Q2 in comparison with the market expectations? Let’s quickly scan through the key facts from this Minnetonka-based one of the country’s largest health insurance company’s earnings release this morning:

An Earnings Beat

UnitedHealth came out with earnings of $3.14 per share, which surpassed the Zacks Consensus Estimate of $3.03 per share.  The same was up 28% year over year.

Revenues and membership growth were the key reason for the earnings beat.

How Was the Estimate Revision Trend?

You should note that the earnings estimate for  UnitedHealth depicted neutral stance prior to the earnings release. The Zacks Consensus Estimate remained stable over the last seven days.

Nonetheless, UnitedHealth has an impressive earnings surprise history. Before posting the earnings beat in Q2, the company delivered positive surprises in all four trailing quarters.

UnitedHealth Group Incorporated Price and EPS Surprise

Overall, the company has a positive earnings surprise of 3.6% in the trailing four quarters.

In-Line Revenues

UnitedHealth posted revenues of $56.1 billion, which was in line with the Zacks Consensus Estimate. The same was up 12% year over year.

Key Q2 Statistics
 
•    Consolidated medical care ratio of 81.9% decreased 30 basis points year over year.
•    The company served 48.8 million people, up 4.8% year over year.
•    UnitedHealth spent $500 million in share buybacks.
•    Cash flow from operations were $4 billion up 81.8% year over year.

2018 Guidance Update

UnitedHealth revised its 2018 financial outlook given solid second-quarter results. It now expects 2018 net earnings of $11.80 to $12.05 from $11.70 to $11.95 per share expected earlier. Adjusted net earnings have been raised to $12.50 to $12.75 from $12.40 to $12.65 per share guided earlier. Cash flows from operations are expected to approach $15.5 billion.

What Zacks Rank Says

At present, UnitedHealth carries a Zacks Rank #2 (Buy). 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’s earnings report!

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