CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We lift our 12-month target price to $595 from $526, reflecting 21.3x our 2024 EPS estimate, a premium to UNH’s historical forward average given a strong EPS growth outlook. We widen our 2023 adj. EPS estimate to $24.88 from $24.78 and narrow our 2024 estimate to $27.95 from $28.17. UNH reported Q3 adj. EPS of $6.56 vs. $5.79, beating the consensus view by $0.21. The third quarter’s outperformance was driven by strong sales growth from Optum (+22% Y/Y) due to an increase in the number of care services offered and patients served, especially for those with complex care needs, in addition to strengthening operating margins in the UnitedHealthcare business. Given the strong year-to-date performance, UNH was able to lift its 2023 EPS guidance, and we see the company still on target to meet its long-term 13%-16% growth objective. While we still see uncertainty related to PBM reform outcomes, UNH is taking proactive steps to increase price transparency, such as through the recently-launched Price Edge product.