UnitedHealth Group Sees Volatile Trading Amid Earnings Sentiment
UnitedHealth Group's stock fluctuated this week, with initial gains succumbing to a decline in subsequent trading sessions.
Quick overview
- UnitedHealth Group's stock experienced fluctuations this week, initially rising before declining due to an analyst's price target cut.
- The stock dropped by 1.5%, underperforming compared to the S&P 500's 0.6% decline.
- Analyst Kevin Fischbeck raised his fair value estimate significantly from $290 to $325, maintaining a positive outlook on the stock.
- Conversely, analyst Lance Wilkes drastically reduced his fair value estimate from $594 to $377, yet still recommended buying the stock.
UnitedHealth Group‘s stock fluctuated this week, with initial gains succumbing to a decline in subsequent trading sessions.
The stock analysis community can give and take away. That was what caused UnitedHealth Group (NYSE: UNH) stock to go down on Tuesday. The insurance company was affected by an analyst’s price target move, just like in the last trading session. This time, though, it was a cut instead raise. The value of UnitedHealth dropped by 1.5% at the end of the day, which was worse than the 0.6% drop in the S&P 500 (SNPINDEX: ^GSPC).
Last week, UnitedHealth’s stock price went up a lot when it was announced that Warren Buffett’s Berkshire Hathaway had bought a $1.6 billion investment in the company. That price target rise on Monday added to the favorable feelings about UnitedHealth that had been around for a while.
On the other hand, Kevin Fischbeck from Bank of America Securities raised his fair value estimate from $290 to $325, which is a really big jump. This didn’t change his mind about the stock, though; he still thought it was a good idea.
Reports say that Fischbeck’s decision wasn’t necessarily because the Buffett team got involved in the stock. The expert says that the Berkshire purchase is just proof that the company is worth more than it is. He thinks that UnitedHealth and other significant corporations that run managed care organizations (MCOs) have only had short-term drops in profits lately.
Meanwhile, Lance Wilkes from Bernstein SocGen Group was the analyst that made the cut. Wilkes used a vigorous weed whacker on his UnitedHealth fair value estimate long before the market opened on Tuesday. He thought it was worth as much as $594 per share, but now he thinks it’s only worth $377. Even though the change was rather big, he still said to purchase (outperform).
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