Shares of UnitedHealth (UNH) are up nearly 4% in pre-market trading at the time of writing after the health insurance provider reported a solid third-quarter beat. The company’s adjusted earnings per share of $2.92 surpassed the consensus of $2.81, although this was significantly lower than the prior-year quarter’s figure of $7.15 per share.
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Revenue rose 12% year-over-year to $113.16 billion, exceeding the consensus estimate of $113.06 billion. Additionally, UnitedHealth raised its full-year fiscal 2025 earnings per share outlook to $14.90. Meanwhile, adjusted earnings per share are now expected to reach at least $16.25, up from the previous guidance of at least $16.
Details of UNH’s Q3 Results
In Q3, UnitedHealthcare’s revenue jumped 16% year-over-year to $87.07 billion, driven by growth in its Medicare & Retirement and Community & State segments. The company served 50.1 million U.S. consumers, an increase of 795,000 from last year. At the same time, Optum’s revenue rose 8% year-over-year to $69.18 billion, led by growth in Optum Rx.
The overall group’s medical-Care Ratio (MCR) stood at 89.9%, in-line with the company’s own expectations but below Wall Street’s expected 90.7%.
UnitedHealth Group is pursuing an aggressive turnaround strategy under second-time CEO Stephen Hemsley. Managed-care companies are under pressure from rising medical costs and new regulations. UNH’s main challenges are in the Medicare business, which is being investigated by the Justice Department. The company expects Medicare margins to improve in 2026.
Is UNH Stock a Buy, Hold, or Sell?
Ahead of the Q3 print, analysts remained divided on UnitedHealth’s long-term outlook. On TipRanks, UNH stock has a Moderate Buy consensus rating based on 18 Buys, two Holds, and two Sell ratings. The average UnitedHealth price target of $361.34 implies 1.3% downside potential from current levels.
Please note that these ratings were issued before the results and are subject to change once analysts review them.
