UnitedHealth Group (NYSE:UNH) Stock Price Down 4.6% Following Weak Earnings

Key Points

• UnitedHealth Group's stock price fell 4.6% after the company reported weaker-than-expected quarterly earnings, with earnings per share of $4.08 missing estimates by $1.08.
• The company announced an increase in its quarterly dividend, raising it from $2.10 to $2.21, which represents a 3.30% yield.
• Several analysts downgraded their ratings and target prices for UnitedHealth Group, with Mizuho reducing its target from $515.00 to $350.00 while maintaining an "outperform" rating.

Shares of UnitedHealth Group Incorporated (NYSE:UNH - Get Free Report) traded down 4.6% on Tuesday following a dissappointing earnings announcement. The company traded as low as $260.55 and last traded at $269.10. 21,043,308 shares were traded during trading, an increase of 84% from the average session volume of 11,449,892 shares. The stock had previously closed at $282.12.

The healthcare conglomerate reported $4.08 earnings per share for the quarter, missing the consensus estimate of $4.45 by ($0.37). The business had revenue of $111.62 billion for the quarter, compared to the consensus estimate of $111.75 billion. UnitedHealth Group had a return on equity of 23.32% and a net margin of 5.04%. The firm's revenue for the quarter was up 12.9% on a year-over-year basis. During the same quarter in the previous year, the company earned $6.80 earnings per share.

UnitedHealth Group Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Tuesday, June 24th. Stockholders of record on Monday, June 16th were paid a $2.21 dividend. The ex-dividend date of this dividend was Monday, June 16th. This represents a $8.84 dividend on an annualized basis and a dividend yield of 3.7%. This is an increase from UnitedHealth Group's previous quarterly dividend of $2.10. UnitedHealth Group's payout ratio is currently 37.02%.

Analysts Set New Price Targets

Several research firms have recently weighed in on UNH. KeyCorp lowered their price objective on shares of UnitedHealth Group from $400.00 to $350.00 and set an "overweight" rating for the company in a research note on Wednesday. TD Securities reissued a "hold" rating and set a $308.00 price objective (down previously from $520.00) on shares of UnitedHealth Group in a research report on Monday, May 19th. Royal Bank Of Canada cut their price objective on shares of UnitedHealth Group from $355.00 to $286.00 and set an "outperform" rating on the stock in a research report on Wednesday. Barclays reiterated an "overweight" rating on shares of UnitedHealth Group in a report on Thursday, July 17th. Finally, Truist Financial cut their target price on UnitedHealth Group from $360.00 to $345.00 and set a "buy" rating on the stock in a report on Wednesday, July 16th. Three investment analysts have rated the stock with a sell rating, seven have assigned a hold rating and fifteen have given a buy rating to the company. According to MarketBeat.com, the company has a consensus rating of "Hold" and a consensus target price of $373.52.

Insider Buying and Selling at UnitedHealth Group

In other UnitedHealth Group news, CEO Patrick Hugh Conway sold 589 shares of the stock in a transaction on Tuesday, June 10th. The stock was sold at an average price of $305.00, for a total transaction of $179,645.00. Following the completion of the transaction, the chief executive officer directly owned 10,398 shares of the company's stock, valued at approximately $3,171,390. This represents a 5.36% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, CFO John F. Rex acquired 17,175 shares of UnitedHealth Group stock in a transaction on Friday, May 16th. The shares were purchased at an average cost of $291.12 per share, with a total value of $4,999,986.00. Following the completion of the acquisition, the chief financial officer owned 203,796 shares of the company's stock, valued at $59,329,091.52. This trade represents a 9.20% increase in their position. The disclosure for this purchase can be found here. Insiders purchased a total of 109,408 shares of company stock valued at $31,607,768 in the last ninety days. 0.28% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On UnitedHealth Group

Several institutional investors and hedge funds have recently bought and sold shares of UNH. Marshall & Sterling Wealth Advisors Inc. bought a new stake in UnitedHealth Group during the 4th quarter valued at $26,000. Hurley Capital LLC bought a new stake in UnitedHealth Group during the 4th quarter valued at $28,000. Bayforest Capital Ltd raised its holdings in UnitedHealth Group by 685.7% during the 1st quarter. Bayforest Capital Ltd now owns 55 shares of the healthcare conglomerate's stock valued at $29,000 after acquiring an additional 48 shares during the period. Aster Capital Management DIFC Ltd bought a new position in UnitedHealth Group in the 4th quarter valued at $30,000. Finally, Clal Insurance Enterprises Holdings Ltd boosted its holdings in UnitedHealth Group by 416.7% in the 1st quarter. Clal Insurance Enterprises Holdings Ltd now owns 62 shares of the healthcare conglomerate's stock valued at $32,000 after purchasing an additional 50 shares during the period. 87.86% of the stock is owned by institutional investors.

UnitedHealth Group Stock Performance

The company's fifty day simple moving average is $298.02 and its 200 day simple moving average is $418.35. The company has a current ratio of 0.85, a quick ratio of 0.85 and a debt-to-equity ratio of 0.73. The stock has a market capitalization of $215.36 billion, a P/E ratio of 10.29, a P/E/G ratio of 1.54 and a beta of 0.45.

About UnitedHealth Group

UnitedHealth Group Incorporated operates as a diversified health care company in the United States. The company operates through four segments: UnitedHealthcare, Optum Health, Optum Insight, and Optum Rx. The UnitedHealthcare segment offers consumer-oriented health benefit plans and services for national employers, public sector employers, mid-sized employers, small businesses, and individuals; health care coverage, and health and well-being services to individuals age 50 and older addressing their needs; Medicaid plans, children's health insurance and health care programs; and health and dental benefits, and hospital and clinical services, as well as health care benefits products and services to state programs caring for the economically disadvantaged, medically underserved, and those without the benefit of employer-funded health care coverage.