UnitedHealth Group (UNH - Free Report) closed at $297.60 in the latest trading session, marking a +1.68% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.43%. Elsewhere, the Dow gained 0.5%, while the tech-heavy Nasdaq added 0.75%.
Investors will be hoping for strength from UNH as it approaches its next earnings release. On that day, UNH is projected to report earnings of $4.89 per share, which would represent year-over-year growth of 35.83%. Our most recent consensus estimate is calling for quarterly revenue of $63.96 billion, up 5.55% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $16.24 per share and revenue of $259.10 billion. These totals would mark changes of +7.48% and +7%, respectively, from last 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 a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. The Zacks Consensus EPS estimate remained stagnant within the past month. UNH currently has a Zacks Rank of #3 (Hold).
Digging into valuation, UNH currently has a Forward P/E ratio of 18.02. Its industry sports an average Forward P/E of 16.35, so we one might conclude that UNH is trading at a premium comparatively.
Also, we should mention that UNH has a PEG ratio of 1.44. 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 1.25 as of yesterday's close.
The Medical - HMOs industry is part of the Medical sector. This group has a Zacks Industry Rank of 163, putting it in the bottom 36% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.