UNITEDHEALTH GROUP INC (UNH) Stock Fundamental Analysis
NYSE:UNH - New York Stock Exchange, Inc. - US91324P1021 - Common Stock - Currency: USD
UNH gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 103 industry peers in the Health Care Providers & Services industry. UNH has a medium profitability rating, but doesn't score so well on its financial health evaluation. UNH may be a bit undervalued, certainly considering the very reasonable score on growth Finally UNH also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year UNH was profitable.
UNH had a positive operating cash flow in the past year.
Each year in the past 5 years UNH has been profitable.
In the past 5 years UNH always reported a positive cash flow from operatings.
1.2 Ratios
UNH has a Return On Assets of 7.14%. This is amongst the best in the industry. UNH outperforms 87.38% of its industry peers.
UNH has a Return On Equity of 21.93%. This is amongst the best in the industry. UNH outperforms 89.32% of its industry peers.
UNH has a Return On Invested Capital of 8.68%. This is in the better half of the industry: UNH outperforms 77.67% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for UNH is in line with the industry average of 9.71%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.14% | ||
| ROE | 21.93% | ||
| ROIC | 8.68% |
ROA(3y)7.06%
ROA(5y)7.43%
ROE(3y)22.21%
ROE(5y)22.85%
ROIC(3y)10.14%
ROIC(5y)10.16%
1.3 Margins
UNH has a better Profit Margin (5.39%) than 78.64% of its industry peers.
UNH's Profit Margin has declined in the last couple of years.
UNH has a better Operating Margin (8.16%) than 74.76% of its industry peers.
UNH's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.16% | ||
| PM (TTM) | 5.39% | ||
| GM | N/A |
OM growth 3Y-1.09%
OM growth 5Y-0.16%
PM growth 3Y-15.71%
PM growth 5Y-8.84%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), UNH is creating some value.
UNH has less shares outstanding than it did 1 year ago.
The number of shares outstanding for UNH has been reduced compared to 5 years ago.
The debt/assets ratio for UNH is higher compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of UNH is 3.31, which is a good value as it means it would take UNH, 3.31 years of fcf income to pay off all of its debts.
UNH has a Debt to FCF ratio of 3.31. This is in the better half of the industry: UNH outperforms 73.79% of its industry peers.
UNH has a Debt/Equity ratio of 0.71. This is a neutral value indicating UNH is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.71, UNH is in line with its industry, outperforming 50.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 3.31 | ||
| Altman-Z | N/A |
ROIC/WACC1.06
WACC8.19%
2.3 Liquidity
A Current Ratio of 0.88 indicates that UNH may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.88, UNH is doing worse than 75.73% of the companies in the same industry.
UNH has a Quick Ratio of 0.88. This is a bad value and indicates that UNH is not financially healthy enough and could expect problems in meeting its short term obligations.
UNH has a Quick ratio of 0.88. This is in the lower half of the industry: UNH underperforms 69.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
UNH shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.46%.
The Earnings Per Share has been growing by 13.07% on average over the past years. This is quite good.
Looking at the last year, UNH shows a quite strong growth in Revenue. The Revenue has grown by 8.06% in the last year.
Measured over the past years, UNH shows a quite strong growth in Revenue. The Revenue has been growing by 10.57% on average per year.
EPS 1Y (TTM)7.46%
EPS 3Y13.67%
EPS 5Y13.07%
EPS Q2Q%0.56%
Revenue 1Y (TTM)8.06%
Revenue growth 3Y11.65%
Revenue growth 5Y10.57%
Sales Q2Q%9.49%
3.2 Future
The Earnings Per Share is expected to grow by 8.37% on average over the next years. This is quite good.
The Revenue is expected to grow by 8.02% on average over the next years. This is quite good.
EPS Next Y-20.07%
EPS Next 2Y-3.77%
EPS Next 3Y1.93%
EPS Next 5Y8.37%
Revenue Next Year12.1%
Revenue Next 2Y9.2%
Revenue Next 3Y8.51%
Revenue Next 5Y8.02%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 10.75, the valuation of UNH can be described as reasonable.
88.35% of the companies in the same industry are more expensive than UNH, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.52. UNH is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 11.63 indicates a reasonable valuation of UNH.
Based on the Price/Forward Earnings ratio, UNH is valued cheaper than 82.52% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 35.58. UNH is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.75 | ||
| Fwd PE | 11.63 |
4.2 Price Multiples
72.82% of the companies in the same industry are more expensive than UNH, based on the Enterprise Value to EBITDA ratio.
83.50% of the companies in the same industry are more expensive than UNH, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.11 | ||
| EV/EBITDA | 8.58 |
4.3 Compensation for Growth
The decent profitability rating of UNH may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.82
EPS Next 2Y-3.77%
EPS Next 3Y1.93%
5. Dividend
5.1 Amount
UNH has a Yearly Dividend Yield of 2.95%. Purely for dividend investing, there may be better candidates out there.
In the last 3 months the price of UNH has falen by -33.81%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 2.52, UNH pays a better dividend. On top of this UNH pays more dividend than 95.15% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.35, UNH pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.95% |
5.2 History
On average, the dividend of UNH grows each year by 14.73%, which is quite nice.
UNH has been paying a dividend for at least 10 years, so it has a reliable track record.
UNH has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.73%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
UNH pays out 34.90% of its income as dividend. This is a sustainable payout ratio.
The dividend of UNH is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP34.9%
EPS Next 2Y-3.77%
EPS Next 3Y1.93%
300.58
-3.52 (-1.16%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners91.04%
Inst Owner Change-0.04%
Ins Owners0.19%
Ins Owner Change3.91%
Market Cap272.67B
Analysts76.25
Price Target388.54 (29.26%)
Short Float %1.3%
Short Ratio0.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.95% |
Yearly Dividend8.19
Dividend Growth(5Y)14.73%
DP34.9%
Div Incr Years15
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.94%
Min EPS beat(2)-2.18%
Max EPS beat(2)0.29%
EPS beat(4)3
Avg EPS beat(4)0.08%
Min EPS beat(4)-2.18%
Max EPS beat(4)1.12%
EPS beat(8)7
Avg EPS beat(8)1.73%
EPS beat(12)11
Avg EPS beat(12)2.42%
EPS beat(16)15
Avg EPS beat(16)2.48%
Revenue beat(2)0
Avg Revenue beat(2)-2.35%
Min Revenue beat(2)-2.79%
Max Revenue beat(2)-1.92%
Revenue beat(4)1
Avg Revenue beat(4)-1.23%
Min Revenue beat(4)-2.79%
Max Revenue beat(4)0.55%
Revenue beat(8)4
Avg Revenue beat(8)-0.32%
Revenue beat(12)5
Avg Revenue beat(12)-0.22%
Revenue beat(16)9
Avg Revenue beat(16)0.04%
PT rev (1m)-3.51%
PT rev (3m)-39.55%
EPS NQ rev (1m)-3.55%
EPS NQ rev (3m)-34.92%
EPS NY rev (1m)-8.2%
EPS NY rev (3m)-25.73%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)-0.64%
Revenue NY rev (1m)-0.2%
Revenue NY rev (3m)-0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.75 | ||
| Fwd PE | 11.63 | ||
| P/S | 0.66 | ||
| P/FCF | 11.11 | ||
| P/OCF | 9.67 | ||
| P/B | 2.7 | ||
| P/tB | 2.7 | ||
| EV/EBITDA | 8.58 |
EPS(TTM)27.96
EY9.3%
EPS(NY)25.86
Fwd EY8.6%
FCF(TTM)27.07
FCFY9%
OCF(TTM)31.09
OCFY10.34%
SpS452.03
BVpS111.13
TBVpS111.13
PEG (NY)N/A
PEG (5Y)0.82
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.14% | ||
| ROE | 21.93% | ||
| ROCE | 11.17% | ||
| ROIC | 8.68% | ||
| ROICexc | 9.8% | ||
| ROICexgc | 37.81% | ||
| OM | 8.16% | ||
| PM (TTM) | 5.39% | ||
| GM | N/A | ||
| FCFM | 5.99% |
ROA(3y)7.06%
ROA(5y)7.43%
ROE(3y)22.21%
ROE(5y)22.85%
ROIC(3y)10.14%
ROIC(5y)10.16%
ROICexc(3y)11.32%
ROICexc(5y)11.36%
ROICexgc(3y)32.46%
ROICexgc(5y)32.01%
ROCE(3y)13.1%
ROCE(5y)13.1%
ROICexcg growth 3Y-2.11%
ROICexcg growth 5Y-0.12%
ROICexc growth 3Y-2.38%
ROICexc growth 5Y-0.43%
OM growth 3Y-1.09%
OM growth 5Y-0.16%
PM growth 3Y-15.71%
PM growth 5Y-8.84%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover1.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 3.31 | ||
| Debt/EBITDA | 1.89 | ||
| Cap/Depr | 87.77% | ||
| Cap/Sales | 0.89% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.94% | ||
| Profit Quality | 111.07% | ||
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z | N/A |
F-Score7
WACC8.19%
ROIC/WACC1.06
Cap/Depr(3y)84.34%
Cap/Depr(5y)80.61%
Cap/Sales(3y)0.88%
Cap/Sales(5y)0.86%
Profit Quality(3y)124.43%
Profit Quality(5y)123.8%
High Growth Momentum
Growth
EPS 1Y (TTM)7.46%
EPS 3Y13.67%
EPS 5Y13.07%
EPS Q2Q%0.56%
EPS Next Y-20.07%
EPS Next 2Y-3.77%
EPS Next 3Y1.93%
EPS Next 5Y8.37%
Revenue 1Y (TTM)8.06%
Revenue growth 3Y11.65%
Revenue growth 5Y10.57%
Sales Q2Q%9.49%
Revenue Next Year12.1%
Revenue Next 2Y9.2%
Revenue Next 3Y8.51%
Revenue Next 5Y8.02%
EBIT growth 1Y3.95%
EBIT growth 3Y10.44%
EBIT growth 5Y10.4%
EBIT Next Year-3.21%
EBIT Next 3Y6.93%
EBIT Next 5Y8.55%
FCF growth 1Y-28.23%
FCF growth 3Y0.99%
FCF growth 5Y4.56%
OCF growth 1Y-24.21%
OCF growth 3Y2.39%
OCF growth 5Y5.37%