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 102 industry peers in the Health Care Providers & Services industry. While UNH is still in line with the averages on profitability rating, there are concerns on its financial health. UNH has a decent growth rate and is not valued too expensively. UNH also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year UNH was profitable.
In the past year UNH had a positive cash flow from operations.
UNH had positive earnings in each of the past 5 years.
Each year in the past 5 years UNH had a positive operating cash flow.
1.2 Ratios
The Return On Assets of UNH (7.14%) is better than 88.24% of its industry peers.
With an excellent Return On Equity value of 21.93%, UNH belongs to the best of the industry, outperforming 88.24% of the companies in the same industry.
With a decent Return On Invested Capital value of 8.68%, UNH is doing good in the industry, outperforming 77.45% of the companies in the same industry.
UNH had an Average Return On Invested Capital over the past 3 years of 10.14%. This is in line with the industry average of 9.13%.
| 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 78.43% of its industry peers.
UNH's Profit Margin has declined in the last couple of years.
UNH has a Operating Margin of 8.16%. This is in the better half of the industry: UNH outperforms 74.51% 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
UNH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, UNH has less shares outstanding
UNH has less shares outstanding than it did 5 years ago.
The debt/assets ratio for UNH is higher compared to a year ago.
2.2 Solvency
UNH has a debt to FCF ratio of 3.31. This is a good value and a sign of high solvency as UNH would need 3.31 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.31, UNH is doing good in the industry, outperforming 76.47% of the companies in the same industry.
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 49.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 3.31 | ||
| Altman-Z | N/A |
ROIC/WACC1.08
WACC8.06%
2.3 Liquidity
A Current Ratio of 0.88 indicates that UNH may have some problems paying its short term obligations.
With a Current ratio value of 0.88, UNH is not doing good in the industry: 80.39% of the companies in the same industry are doing better.
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's Quick ratio of 0.88 is on the low side compared to the rest of the industry. UNH is outperformed by 72.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.46% over the past year.
UNH shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.07% yearly.
UNH shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.06%.
The Revenue has been growing by 10.57% on average over the past years. This is quite good.
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
UNH is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.48% yearly.
Based on estimates for the next years, UNH will show a quite strong growth in Revenue. The Revenue will grow by 9.01% on average per year.
EPS Next Y4.2%
EPS Next 2Y8.91%
EPS Next 3Y10.24%
EPS Next 5Y12.48%
Revenue Next Year12.5%
Revenue Next 2Y10.26%
Revenue Next 3Y9.48%
Revenue Next 5Y9.01%
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 stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.33 indicates a correct valuation of UNH.
Based on the Price/Earnings ratio, UNH is valued a bit cheaper than 73.53% of the companies in the same industry.
When comparing the Price/Earnings ratio of UNH to the average of the S&P500 Index (27.85), we can say UNH is valued slightly cheaper.
A Price/Forward Earnings ratio of 12.10 indicates a correct valuation of UNH.
Based on the Price/Forward Earnings ratio, UNH is valued cheaper than 83.33% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.77. UNH is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.33 | ||
| Fwd PE | 12.1 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, UNH is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
75.49% 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 | 14.85 | ||
| EV/EBITDA | 11.2 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
UNH has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.41
PEG (5Y)1.1
EPS Next 2Y8.91%
EPS Next 3Y10.24%
5. Dividend
5.1 Amount
UNH has a Yearly Dividend Yield of 1.98%. Purely for dividend investing, there may be better candidates out there.
The stock price of UNH dropped by -26.14% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
UNH's Dividend Yield is rather good when compared to the industry average which is at 2.57. UNH pays more dividend than 92.16% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.45, UNH has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
5.2 History
The dividend of UNH is nicely growing with an annual growth rate of 14.73%!
UNH has paid a dividend for at least 10 years, which is 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.
UNH's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP34.9%
EPS Next 2Y8.91%
EPS Next 3Y10.24%
400.68
-10.76 (-2.62%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Providers & Services
Earnings (Last)
Earnings (Next)
Inst Owners89.44%
Inst Owner Change1.12%
Ins Owners0.17%
Ins Owner Change0.29%
Market Cap364.71B
Analysts85.29
Price Target583.19 (45.55%)
Short Float %1.28%
Short Ratio1.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
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)-10.57%
PT rev (3m)-10.49%
EPS NQ rev (1m)-4.56%
EPS NQ rev (3m)-2.83%
EPS NY rev (1m)-3.17%
EPS NY rev (3m)-3.53%
Revenue NQ rev (1m)0.16%
Revenue NQ rev (3m)4.99%
Revenue NY rev (1m)0.22%
Revenue NY rev (3m)0.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.33 | ||
| Fwd PE | 12.1 | ||
| P/S | 0.89 | ||
| P/FCF | 14.85 | ||
| P/OCF | 12.93 | ||
| P/B | 3.62 | ||
| P/tB | 3.62 | ||
| EV/EBITDA | 11.2 |
EPS(TTM)27.96
EY6.98%
EPS(NY)33.12
Fwd EY8.27%
FCF(TTM)26.97
FCFY6.73%
OCF(TTM)30.99
OCFY7.73%
SpS450.5
BVpS110.75
TBVpS110.76
PEG (NY)3.41
PEG (5Y)1.1
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
WACC8.06%
ROIC/WACC1.08
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 Y4.2%
EPS Next 2Y8.91%
EPS Next 3Y10.24%
EPS Next 5Y12.48%
Revenue 1Y (TTM)8.06%
Revenue growth 3Y11.65%
Revenue growth 5Y10.57%
Sales Q2Q%9.49%
Revenue Next Year12.5%
Revenue Next 2Y10.26%
Revenue Next 3Y9.48%
Revenue Next 5Y9.01%
EBIT growth 1Y3.95%
EBIT growth 3Y10.44%
EBIT growth 5Y10.4%
EBIT Next Year18.42%
EBIT Next 3Y12.92%
EBIT Next 5Y12.34%
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%