C. Kim Goodwin UnitedHealth Group Inc UNH-N TOP PICK Oct 01, 2004

Yes. It was a top pick of his last spring. He doesn't think there will be much negative impact from Washington investigating their billing practices, though there remains headline risk. Fundamentals are improving, though they are paying out more for medical costs, which he hopes will normalize. It's trading below the market PE, when usually it trades above.

Is down 20% in 6 months and trades at 6.5x EBITA vs. 12x historically, strong managers, $20 billion free cash flow and new share buybacks.

The DOJ is going after them for Medicare payments. Is taking some risk off the table.

Leader in the space. Trades at 16x forward PE, 11% growth. Last 5 years, earnings have growth 12% a year. 200-day MA trending higher, but price is a bit below that, so technical signals are neutral. Integrated model strong. Pricing power. Down 24% from recent highs on regulatory concerns, overdone.

Near term, this can't trade at prior multiples given volatility. Anything healthcare is uncertain. He still believes in the $600 price target. Great management. They have growth.

Is up 10% in the past month. Don't chase a red hot stock, but let it come in a bit (lower). Every time this spikes, it goes down. It's best of breed.

It reports Thursday. Not too high of a PE and not overly loved and purely domestic. It has pricing power.

Down today, so an opportunity. The largest health insurer can do anything it wants under this presidency.

Has plunged 22% since reporting last Thursday and dragged the sector down. What in the world happened? They missed top and bottom lines, but worse they cut their full-year earnings forecast by 12%, citing high medical costs in its Medicare plans. The health profiles of many patients has been inaccurate., especially in their managed care business. Their medical care ratio was 84.8% in Q1 2025, but they guided full year at 87.5%. However, UNH's peers are faring better. UNH is having execution problems and is no longer best of breed.

Fallen angel. Disappointing quarter, severely lowered guidance for 2025. 80% of its business is healthcare insurance. Taking market share in every segment they operate in. Funding pressure on government-funded healthcare insurance is curtailing short-term profitability; but this is building long-term value for shareholders. Secular trends of demographics and morbidity in the US are tailwinds. 

Fortress-like balance sheet, A+ credit rating. Buying back shares prolifically with FCF. Trading at 15x PE vs. the 5-year average of 19.5x. Yield is 1.97%.