Just a Dude Who Invests
Retail Investor, Economics & Technology Commentary
UnitedHealth's debt has to come down to a manageable $20-30B, which would also cut interest expense, and the institutions, TV contributors and big retail accounts pumping it like the next Nvidia are ignoring that. Health insurance is not going away, but the numbers matter more than the hype. x.comÂ
UnitedHealth's model is a conflict of interest, since it owns both the insurer and the doctors and data, which makes it too dark to own. It has been accused of using algorithms to systematically deny care to the elderly and sick to lift profits; as both the largest US employer of doctors and an insurer, the patient loses. The assassination of its CEO showed deep hostility toward that system. A moat built on denying care is not worth owning. x.comÂ
UnitedHealth's earnings visibility, unusually high dividend yield and resumed buybacks make paying under 16x forward earnings not look terrible. Still reasonably confident it is a good place to hide for long-term capital: Hemsley keeps clearing the bar, and UnitedHealth has beaten and raised guidance for three straight quarters. Further derisking remains a risk. x.com x.com x.comÂ
UnitedHealth is exposed as health insurance costs become unaffordable for employers: an industry that lives by price gouging will die by it. US employers face the largest health insurance cost hike since the Affordable Care Act began, with a 25% rise expected in 2027 after a massive drop in exchange enrollment. Employer-based health plans now look set to go the way of pensions and become extinct. x.comÂ
Elevance Health offers deeper value and better growth than UnitedHealth, Centene and similar insurers, trading at about half UnitedHealth's P/E. It is not a sexy trade. MarketSurge picked up a cup breakout with 28% depth, giving a target of 490-500. x.comÂ
UnitedHealth can reach about $450 by year-end as rising inflation pushes investors toward defensives with pricing power. If its medical loss ratio comes in as expected for the full year, confidence may be fully restored and the stock may regain its premium valuation. Management guides for $18.25 EPS this year; at its 10-year average P/E of 24, that implies about $438, and any EPS beat takes it above $450. The stock is now nearly at the earlier $400 call. x.comÂ
UnitedHealth is cheap against its earnings at about 17 times next year's, while health insurers usually get 20 times. Twenty times next year's estimated $22.55 per share, give or take 12%, puts fair value at about $396.80-$505.02, above the $376.30 price; it turns expensive above $435.96. The forward read leans on a forecast 45% above trailing earnings. This is a levels-only screen off reported earnings and revenue estimates, with no fundamental work. x.comÂ
UnitedHealth's potential earnings recovery and margin expansion offer a fundamental case for its emerging Stage 2 uptrend. EPS is expected to grow 53%, from $20.47 in 2026 to $31.31 by 2029, while revenue is projected to rise from $448B to $511B; a weekly bull flag has broken out. x.comÂ
UnitedHealth could be a $600 stock over the next three to five years if margins stabilize, a solid return from here, as the market remembers why it has been a strong long-term compounder. It has scale, Optum, insurance exposure and durable cash flow; the stock was hit by medical-cost pressure, regulation and sentiment, but the business still generates a lot of cash. SoFi and ServiceNow offer more upside, with three-year targets of $80+ and $300+. x.com x.comÂ
UnitedHealth may be making a rare episodic pivot for a stock its size, coming off an earnings beat. The stock is incredibly undervalued. x.comÂ