UnitedHealth Group Incorporated ((NYSE:UN)H) came out with its full-year results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Results were roughly in line with estimates, with revenues of US$257b and statutory earnings per share of US$16.03. Earnings are an important time for investors, as they can track a company’s performance, look at what the analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for UnitedHealth Group
After the latest results, the 19 analysts covering UnitedHealth Group are now predicting revenues of US$278.9b in 2021. If met, this would reflect a decent 8.4% improvement in sales compared to the last 12 months. Per-share earnings are expected to increase 8.2% to US$17.35. In the lead-up to this report, the analysts had been modelling revenues of US$278.2b and earnings per share (EPS) of US$17.43 in 2021. The consensus analysts don’t seem to have seen anything in these results that would have changed their view on the business, given there’s been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$396, suggesting that the company has met expectations in its recent result. The consensus price target is just an average of individual analyst targets, so – it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values UnitedHealth Group at US$462 per share, while the most bearish prices it at US$329. As you can see, analysts are not all in agreement on the stock’s future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the UnitedHealth Group’s past performance and to peers in the same industry. Next year brings more of the same, according to the analysts, with revenue forecast to grow 8.4%, in line with its 9.2% annual growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 7.1% next year. So although UnitedHealth Group is expected to maintain its revenue growth rate, it’s only growing at about the rate of the wider industry.
The Bottom Line
The most obvious conclusion is that there’s been no major change in the business’ prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$396, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. We have estimates – from multiple UnitedHealth Group analysts – going out to 2025, and you can see them free on our platform here.
You should always think about risks though. Case in point, we’ve spotted 2 warning signs for UnitedHealth Group you should be aware of.
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