Comparing UnitedHealth Group (UNH) and Its Competitors

UnitedHealth Group (NYSE: UNH) is one of 13 public companies in the “Managed Health Care” industry, but how does it contrast to its peers? We will compare UnitedHealth Group to related businesses based on the strength of its earnings, dividends, risk, analyst recommendations, valuation, profitability and institutional ownership.

Profitability

This table compares UnitedHealth Group and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
UnitedHealth Group 4.50% 21.52% 6.99%
UnitedHealth Group Competitors 1.83% 11.42% 3.50%

Dividends

UnitedHealth Group pays an annual dividend of $3.00 per share and has a dividend yield of 1.4%. UnitedHealth Group pays out 33.3% of its earnings in the form of a dividend. As a group, “Managed Health Care” companies pay a dividend yield of 0.9% and pay out 19.9% of their earnings in the form of a dividend. UnitedHealth Group has increased its dividend for 7 consecutive years.

Volatility and Risk

UnitedHealth Group has a beta of 0.66, suggesting that its share price is 34% less volatile than the S&P 500. Comparatively, UnitedHealth Group’s peers have a beta of 0.70, suggesting that their average share price is 31% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for UnitedHealth Group and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
UnitedHealth Group 0 0 22 0 3.00
UnitedHealth Group Competitors 81 937 1489 24 2.58

UnitedHealth Group currently has a consensus price target of $227.19, suggesting a potential upside of 3.30%. As a group, “Managed Health Care” companies have a potential downside of 3.78%. Given UnitedHealth Group’s stronger consensus rating and higher probable upside, research analysts plainly believe UnitedHealth Group is more favorable than its peers.

Earnings and Valuation

This table compares UnitedHealth Group and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
UnitedHealth Group $184.83 billion $7.02 billion 24.38
UnitedHealth Group Competitors $50.73 billion $1.52 billion 10.11

UnitedHealth Group has higher revenue and earnings than its peers. UnitedHealth Group is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

86.2% of UnitedHealth Group shares are held by institutional investors. Comparatively, 90.7% of shares of all “Managed Health Care” companies are held by institutional investors. 0.9% of UnitedHealth Group shares are held by insiders. Comparatively, 2.6% of shares of all “Managed Health Care” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

UnitedHealth Group beats its peers on 10 of the 15 factors compared.

About UnitedHealth Group

UnitedHealth Group Incorporated is a health and well-being company. The Company operates through four segments: UnitedHealthcare, OptumHealth, OptumInsight and OptumRx. It conducts its operations through two business platforms: health benefits operating under UnitedHealthcare and health services operating under Optum. UnitedHealthcare provides healthcare benefits to an array of customers and markets, and includes UnitedHealthcare Employer & Individual, UnitedHealthcare Medicare & Retirement, UnitedHealthcare Community & State, and UnitedHealthcare Global businesses. Optum is a health services business serving the healthcare marketplace, including payers, care providers, employers, governments, life sciences companies and consumers, through its OptumHealth, OptumInsight and OptumRx businesses. OptumInsight provides services, technology and healthcare solutions to participants in the healthcare industry. OptumRx provides retail network contracting, purchasing and clinical solutions.

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