UnitedHealth's Stock Drops After Profit Beat But Medical Costs Climb And Full-Year Outlook Was Lowered -- MarketWatch

MarketWatch · 10/15 10:05

Shares of UnitedHealthGroup Inc. (UNH) lost 2.3% in premarket trading Tuesday, to pull back from the previous session's record close, after the healthcare giant beat third-quarter profit and revenue expectations but missed on the medical-care ratio and lowered its full-year outlook. Net income rose to $6.06 billion, or $6.51 a share, from $5.84 billion, or $6.24 a share, in the same period a year ago. Excluding nonrecurring items, adjusted earnings per share of $7.15 topped the FactSet consensus of $7.00. Total revenue grew 9.2% to $100.82 billion, above the FactSet consensus of $99.14 billion. The medical-care ratio, or the percentage of premium dollars spent on services - lower is better - increased to 85.2% from 82.3%, amid Medicare funding reductions, compared with the FactSet consensus of 84.4%. Among the company's business segments, UnitedHealthcare revenue rose 7.2% to $74.9 billion and Optum revenue was up 12.7% to $63.9 billion. Looking ahead, .guidance range for full-year adjusted EPS was trimmed to $27.50 to $27.75 from $27.50 to $28.00. The stock has climbed 15% year to date through Monday, while the Health Care Select Sector SPDR ETF (XLV) has advanced 13.5% and the S&P 500 index has rallied 22.9%.

-Tomi Kilgore

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October 15, 2024 06:05 ET (10:05 GMT)