Here's Why UnitedHealth Group (UNH) Fell More Than Broader Market

UnitedHealth Group (UNH) ended the recent trading session at $289.21, demonstrating a -1.94% change from the preceding day's closing price. This change lagged the S&P 500's daily loss of 0.94%. Elsewhere, the Dow saw a downswing of 0.83%, while the tech-heavy Nasdaq depreciated by 1.02%.

Shares of the largest U.S. health insurer have appreciated by 3.27% over the course of the past month, outperforming the Medical sector's gain of 2.62%, and the S&P 500's loss of 1.3%.

The investment community will be paying close attention to the earnings performance of UnitedHealth Group in its upcoming release. On that day, UnitedHealth Group is projected to report earnings of $6.76 per share, which would represent a year-over-year decline of 6.11%. At the same time, our most recent consensus estimate is projecting a revenue of $110.26 billion, reflecting a 0.62% rise from the equivalent quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $17.7 per share and a revenue of $440.44 billion, representing changes of +8.26% and -1.59%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for UnitedHealth Group. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.12% upward. As of now, UnitedHealth Group holds a Zacks Rank of #3 (Hold).

In terms of valuation, UnitedHealth Group is presently being traded at a Forward P/E ratio of 16.67. This signifies a premium in comparison to the average Forward P/E of 15.02 for its industry.

One should further note that UNH currently holds a PEG ratio of 1.36. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As the market closed yesterday, the Medical - HMOs industry was having an average PEG ratio of 1.

The Medical - HMOs industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 228, positioning it in the bottom 7% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.