UnitedHealth faced several challenges last year, but it has taken important steps to address problem areas. The stock climbed 25% in the first half of the year.
UnitedHealth on Tuesday said an audit by an external consulting firm showed nearly 97% of diagnoses identified within its HouseCalls home-health unit, which has faced scrutiny from lawmakers, were supported by a patient's medical record.
UnitedHealth is prioritizing profitability over rapid growth as improving margins, stronger earnings and Optum expansion aim to support a long-term turnaround.
UnitedHealth generates higher overall revenue, though CVS Health has occasionally narrowed the gap between the two companies. Both companies experienced steady quarter-over-quarter revenue expansion through late 2025 before posting slight sequential declines in early 2026.
UnitedHealth Group remains undervalued and is positioned as a strong long-term investment despite recent price appreciation and operational challenges. Management maintains a long-term growth algorithm of 13–16% bottom-line growth, driven by margin recovery, AI investments, and capital allocation including share buybacks. Current valuation models, even with conservative growth assumptions, suggest significant intrinsic value upside, but recent rapid price gains may limit short-term upside.
UnitedHealth Group is reiterated as a buy, with a raised price target near $460, reflecting improved earnings guidance and operational turnaround. Q1 results beat expectations, with non-GAAP EPS of $7.23 and revenue of $111.7B, prompting an FY 2026 EPS outlook above $18.25 and a $2B buyback. UNH benefits from strong free cash flow, a 2.18% yield, positive EPS revisions, and strategic investments in modernization and AI.