UnitedHealth Group Inc. raised its full-year profit outlook on Thursday after reporting second-quarter earnings that topped Wall Street expectations.
The parent of the largest health insurer in the U.S. UNH, +0.75% raised its full-year earnings per share guidance to $13.95 to $14.15 from the prior guidance of $13.80 to $14.05. Full-year adjusted earnings per share is now expected to range from $14.70 to $14.90, up from its previous forecast of $14.50 to $14.75.
Profit for the latest quarter rose 13% to $3.293 billion, or $3.42 a share, compared with $2.922 billion, or $2.98 a share, a year ago. Adjusted earnings per share was $3.60 a share. Analysts polled by FactSet had expected of $3.45 a share.
Revenue rose 8% to $60.595 billion from $56.086 billion the year before, driven by strong growth in the OptumRx, OptumHealth and UnitedHealthcare’s Medicare-and-retirement segment. Sales from the company’s Medicare-and-retirement unit rose 10.6% to $20.9 billion, while OptumRx sales grew 11.7% to $18.9 billion. Revenue from the company’s OptumHealth business grew 20.3% to $6.1 billion, with the average revenue per consumer increasing 17% year-over-year.
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Analysts cheered the results. “This is a welcome clean beat and raise to kick off earnings season,” Evercore ISI analyst Michael Newshel wrote in a note to clients Thursday morning.
However, the company’s robust earnings report didn’t seem to move shares much; UnitedHealth stock is up just 0.5% in premarket trade. The muted reaction is a sharp contrast to investors’ response to last quarter’s earnings, when fears around “Medicare for all” sent UnitedHealth shares spiraling even after the company beat Wall Street expectations and raised its full-year guidance.
Shares of the company have gained 7% in the year to date through Wednesday, while the S&P 500 SPX, -0.65% has gained 19% and the Dow Jones Industrial Average DJIA, -0.42% has gained 16.7%.
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