Morgan Stanley lifts UnitedHealth Group Incorporated [UNH] price estimate. Who else is bullish?

UnitedHealth Group Incorporated [NYSE: UNH] loss -1.27% on the last trading session, reaching $466.59 price per share at the time. The company report on March 28, 2023 that AM Best Assigns Issue Credit Ratings to UnitedHealth Group Incorporated’s New Senior Unsecured Notes and New Shelf Registrations.

AM Best has assigned Long-Term Issue Credit Ratings (Long-Term IR) of “a” (Excellent) to UnitedHealth Group Incorporated’s (UnitedHealth Group) (Minnetonka, MN) [NYSE: UNH] recently issued $1.25 billion 4.250% senior unsecured notes, due 2029, $1.5 billion 4.5% senior unsecured notes, due 2033, $2 billion 5.05% senior unsecured notes, due 2053, and $1.75 billion 5.2% senior unsecured notes, due 2063. In addition, AM Best has assigned indicative Long-Term IRs of “a-” (Excellent) to subordinated issues, “bbb+” (Good) to preferred stock and “a” (Excellent) to senior unsecured issues of the recently filed shelf registration to UnitedHealth Group. The outlook assigned to these Credit Ratings (ratings) is stable. Concurrently, AM Best has withdrawn the ratings on the previous shelf registrations. UnitedHealth Group’s Long-Term Issuer Credit Rating of “a” (Excellent), its Long-Term IRs and the ratings of its insurance subsidiaries are unchanged.

The proceeds from the debt issuance will be used for general corporate purposes, including refinancing short-term debt that was used to finance the LHC Group Inc. (LHC) acquisition, valued at approximately $6 billion including the retirement of LHC debt, which closed early this year. The LHC acquisition will strengthen UnitedHealth Group’s home health services. Following the repayment of commercial paper and upcoming maturities, AM Best anticipates the issuance to increase the group’s adjusted financial leverage ratio approximately 44%. However, UnitedHealth Group has managed to bring its financial leverage down to the 40% range over time taking active actions to deleverage following sizeable acquisitions. As of Dec. 31, 2022, the group’s financial leverage was 41.4%. The organization maintains strong earnings before interest and taxes interest coverage in the low double digits. UnitedHealth Group has excellent liquidity through parent company cash, insurance subsidiary dividend capacity, non-regulated cash flow, commercial paper program and a $18 billion revolving credit agreement. A steady stream of revenue development and earnings growth have resulted in a solid operating performance trend over the past several years underpinned by UnitedHealth Group’s operations at UnitedHealthcare and at Optum. The organization expects this growth to continue over the medium term.

UnitedHealth Group Incorporated represents 934.00 million in outstanding shares, while the company has a total market value of $429.70 billion with the latest information. UNH stock price has been found in the range of $464.95 to $475.88.

If compared to the average trading volume of 3.54M shares, UNH reached a trading volume of 3513122 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Here is what top equities market gurus are saying about UnitedHealth Group Incorporated [UNH]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for UNH shares is $596.26 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on UNH stock is a recommendation set at 1.80. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Morgan Stanley have made an estimate for UnitedHealth Group Incorporated shares, keeping their opinion on the stock as Overweight, with their previous recommendation back on November 23, 2022. The new note on the price target was released on November 21, 2022, representing the official price target for UnitedHealth Group Incorporated stock. Previously, the target price had yet another raise to $575, while Loop Capital analysts kept a Buy rating on UNH stock.

The Average True Range (ATR) for UnitedHealth Group Incorporated is set at 9.94, with the Price to Sales ratio for UNH stock in the period of the last 12 months amounting to 1.33. The Price to Book ratio for the last quarter was 5.60, with the Price to Cash per share for the same quarter was set at 25.37. Price to Free Cash Flow for UNH in the course of the last twelve months was 24.68.

Trading performance analysis for UNH stock

UnitedHealth Group Incorporated [UNH] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -1.88. With this latest performance, UNH shares dropped by -1.96% in over the last four-week period, additionally sinking by -8.22% over the last 6 months – not to mention a drop of -9.08% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for UNH stock in for the last two-week period is set at 42.61, with the RSI for the last a single of trading hit 41.35, and the three-weeks RSI is set at 42.98 for UnitedHealth Group Incorporated [UNH]. The present Moving Average for the last 50 days of trading for this stock 480.68, while it was recorded at 473.39 for the last single week of trading, and 511.57 for the last 200 days.

UnitedHealth Group Incorporated [UNH]: A deeper dive into fundamental analysis

Operating Margin for any stock indicates how profitable investing would be, and UnitedHealth Group Incorporated [UNH] shares currently have an operating margin of +8.77. UnitedHealth Group Incorporated’s Net Margin is presently recorded at +6.21.

Return on Total Capital for UNH is now 20.64, given the latest momentum, and Return on Invested Capital for the company is 15.86. Return on Equity for this stock inclined to 26.91, with Return on Assets sitting at 8.63. When it comes to the capital structure of this company, UnitedHealth Group Incorporated [UNH] has a Total Debt to Total Equity ratio set at 80.30. Additionally, UNH Total Debt to Total Capital is recorded at 44.54, with Total Debt to Total Assets ending up at 24.95. Long-Term Debt to Equity for the company is recorded at 75.02, with the Long-Term Debt to Total Capital now at 41.61.

Reflecting on the efficiency of the workforce at the company, UnitedHealth Group Incorporated [UNH] managed to generate an average of $50,300 per employee.

UnitedHealth Group Incorporated [UNH]: An earnings per share (EPS) analysis

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for UNH. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for UnitedHealth Group Incorporated go to 13.89%.

An analysis of insider ownership at UnitedHealth Group Incorporated [UNH]

There are presently around $390,865 million, or 89.70% of UNH stock, in the hands of institutional investors. The top three institutional holders of UNH stocks are: VANGUARD GROUP INC with ownership of 84,052,380, which is approximately 1.305% of the company’s market cap and around 0.10% of the total institutional ownership; BLACKROCK INC., holding 74,418,906 shares of the stock with an approximate value of $35.17 billion in UNH stocks shares; and FMR LLC, currently with $22.88 billion in UNH stock with ownership of nearly -3.902% of the company’s market capitalization.

Positions in UnitedHealth Group Incorporated stocks held by institutional investors increased at the end of Friday and at the time of the Friday reporting period, where 1,586 institutional holders increased their position in UnitedHealth Group Incorporated [NYSE:UNH] by around 32,099,352 shares. Additionally, 1,363 investors decreased positions by around 27,192,787 shares, while 330 investors held positions by with 767,795,847 shares. The mentioned changes placed institutional holdings at 827,087,986 shares, according to the latest SEC report filing. UNH stock had 291 new institutional investments in for a total of 4,402,052 shares, while 101 institutional investors sold positions of 967,887 shares during the same period.