UnitedHealth Group kicked off Q4 reporting for the managed-care sector before Wednesday's open, topping estimates and standing by 2022 guidance. After the report, UNH stock rose slightly in Wednesday's stock market action.
"Our strong 2021 performance and confident growth outlook for 2022 and beyond reflect the accelerating innovation and expanding capabilities across Optum and UnitedHealthcare," CEO Andrew Witty said in a statement.
UNH Earnings
Estimates: Analysts expected UnitedHealth earnings of $4.31 per share, up 71% from a Covid-hit year-ago result. Revenue was seen growing 11.7% to $73.1 billion.
Results: UnitedHealth earnings per share grew 78% to $4.48. Revenue rose 12.6% to $73.7 billion.
Medical costs as a share of premiums came in at 83.7% in Q4.
Outlook: UnitedHealth stood by initial full-year 2022 guidance that was issued ahead of its Nov. 30 investor day for adjusted EPS of $21.10 to $21.60. Analysts expect UnitedHealth to earn $21.71 per share. The company noted that it also was sticking by guidance for Medicare Advantage membership, indicating that enrollment for 2022 was on track.
UNH Stock
UNH stock rose 0.3% to 462.52 in trade. UNH stock closed off 1.6% to 460.99 in Tuesday's market drubbing, slipping back below its 50-day moving average.
UNH stock finished Tuesday's session 9.5% below its 509.23 record high set on Dec. 30. The managed-care sector got the year off to a rocky start, as the whole group got caught in Humana's downdraft after the insurer warned on Medicare Advantage enrollment on Jan. 6.
If UNH can retake its 21-day line as well as its 50-day average, that could provide an entry point. A break above the 50-day average for quality stocks can provide an early entry point, especially when the test of its 50-day comes above the prior buy point. That's the case for UNH stock, which rose clear of 431.46 buy point on Oct. 20.
However, UNH stock's pullback to the 50-day line was steep. Meanwhile, stock market weakness, including the medical sector, should make investors cautious about any purchases.
However, make sure to read IBD's daily afternoon The Big Picture column to get the latest on the prevailing stock market trend and what it means for your trading decisions.
UNH has a solid 78 IBD Composite Rating, a single rating combining technical and fundamental factors. That factors in some up-and-down earnings amid Covid.
