UNITEDHEALTH GROUP INC (UNH) Stock Fundamental Analysis
NYSE:UNH - New York Stock Exchange, Inc. - US91324P1021 - Common Stock - Currency: USD
Taking everything into account, UNH scores 5 out of 10 in our fundamental rating. UNH was compared to 103 industry peers in the Health Care Providers & Services industry. There are concerns on the financial health of UNH while its profitability can be described as average. UNH is valued quite cheap, while showing a decent growth score. This is a good combination! 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.
UNH had positive earnings in each of the past 5 years.
UNH had a positive operating cash flow in each of the past 5 years.
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 better Return On Equity (21.93%) than 89.32% of its industry peers.
The Return On Invested Capital of UNH (8.68%) is better than 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 Profit Margin of 5.39%. This is in the better half of the industry: UNH outperforms 78.64% of its industry peers.
UNH's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 8.16%, UNH is in the better half of the industry, outperforming 74.76% of the companies in the same industry.
In the last couple of years the Operating Margin of UNH has remained more or less at the same level.
| 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.
Compared to 1 year ago, UNH has a worse debt to assets ratio.
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.
With a decent Debt to FCF ratio value of 3.31, UNH is doing good in the industry, outperforming 73.79% 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.
UNH has a Debt to Equity ratio of 0.71. This is comparable to the rest of the industry: UNH outperforms 50.49% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 3.31 | ||
| Altman-Z | N/A |
ROIC/WACC1.08
WACC8.01%
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.
The Quick ratio of UNH (0.88) is worse than 69.90% 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
Based on estimates for the next years, UNH will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.37% on average per year.
The Revenue is expected to grow by 8.02% on average over the next years. This is quite good.
EPS Next Y-18.45%
EPS Next 2Y-2.94%
EPS Next 3Y2.77%
EPS Next 5Y8.37%
Revenue Next Year12.12%
Revenue Next 2Y9.24%
Revenue Next 3Y8.57%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 10.88, the valuation of UNH can be described as reasonable.
Based on the Price/Earnings ratio, UNH is valued cheaper than 88.35% of the companies in the same industry.
UNH is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 11.56 indicates a reasonable valuation of UNH.
84.47% of the companies in the same industry are more expensive than UNH, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, UNH is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.88 | ||
| Fwd PE | 11.56 |
4.2 Price Multiples
UNH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. UNH is cheaper than 75.73% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, UNH is valued cheaply inside the industry as 84.47% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.24 | ||
| EV/EBITDA | 8.47 |
4.3 Compensation for Growth
The decent profitability rating of UNH may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.83
EPS Next 2Y-2.94%
EPS Next 3Y2.77%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.87%, UNH has a reasonable but not impressive dividend return.
In the last 3 months the price of UNH has falen by -49.27%. 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 2.43, 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 2.37, UNH pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.73%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
34.90% of the earnings are spent on dividend by UNH. This is a low number and 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-2.94%
EPS Next 3Y2.77%
304.1
+4.59 (+1.53%)
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 Cap275.86B
Analysts76.25
Price Target388.54 (27.77%)
Short Float %1.3%
Short Ratio0.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
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)-30.73%
PT rev (3m)-39.55%
EPS NQ rev (1m)-2.56%
EPS NQ rev (3m)-33.82%
EPS NY rev (1m)-6.34%
EPS NY rev (3m)-24.23%
Revenue NQ rev (1m)-0.09%
Revenue NQ rev (3m)-0.64%
Revenue NY rev (1m)-0.18%
Revenue NY rev (3m)-0.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.88 | ||
| Fwd PE | 11.56 | ||
| P/S | 0.67 | ||
| P/FCF | 11.24 | ||
| P/OCF | 9.78 | ||
| P/B | 2.74 | ||
| P/tB | 2.74 | ||
| EV/EBITDA | 8.47 |
EPS(TTM)27.96
EY9.19%
EPS(NY)26.3
Fwd EY8.65%
FCF(TTM)27.07
FCFY8.9%
OCF(TTM)31.09
OCFY10.22%
SpS452.03
BVpS111.13
TBVpS111.13
PEG (NY)N/A
PEG (5Y)0.83
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
WACC8.01%
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 Y-18.45%
EPS Next 2Y-2.94%
EPS Next 3Y2.77%
EPS Next 5Y8.37%
Revenue 1Y (TTM)8.06%
Revenue growth 3Y11.65%
Revenue growth 5Y10.57%
Sales Q2Q%9.49%
Revenue Next Year12.12%
Revenue Next 2Y9.24%
Revenue Next 3Y8.57%
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%