UnitedHealth Tops Expectations, Raises Guidance--Update
April 19 2016 - 07:42AM
Dow Jones News
By Anne Steele
UnitedHealth Group Inc. on Tuesday raised its guidance for the
year as the biggest U.S. health insurer revised its estimates on
income taxes and amortization and reported better-than-expected
earnings in the first quarter.
The Minnetonka, Minn., company now expects adjusted earnings for
the year of about $7.75 to $7.95 a share on revenue of $182
billion, compared with its previous guidance of $7.60 to $7.80 a
share and at least $180 billion in revenue. UnitedHealth said the
increase in earnings is due to changes in the expected income-tax
rate and intangible amortization.
Chief Executive Stephen Hemsley also pointed to organic growth
and strong customer retention in the most recent quarter.
UnitedHealth's health-services arm Optum continued to show
strength, with revenue there jumping 54% to $19.7 billion,
representing about 44% of the company's top line, powered by
Optum's pharmacy care services. The business has been buoyed by
UnitedHealth's acquisition of pharmacy-benefit manager Catamaran
Corp., which closed in July.
During the quarter, UnitedHealth added 3.1 million customers,
bringing its tally to roughly 43.6 million.
UnitedHealth said its medical-cost ratio increased 30 basis
points year-over-year to 81.7%, reflecting the extra calendar day
of service in the quarter. The company added that medical cost
trends were well-controlled in the first quarter and consistent
with management expectations.
Overall, the company reported a profit of $1.61 billion, or
$1.67 a share, up from $1.41 billion, or $1.46, a year earlier.
Excluding certain items, adjusted earnings rose to $1.81 a share
from $1.55.
Revenue climbed 25% to $44.53 billion. Analysts had projected
earnings of $1.72 a share on revenue of $43.96 billion.
Shares in the company, which kicks off earnings reports for
health insurers, have risen 14% over the past three months and were
inactive premarket.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
April 19, 2016 07:27 ET (11:27 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
UnitedHealth (NYSE:UNH)
Historical Stock Chart
From Feb 2024 to Mar 2024
UnitedHealth (NYSE:UNH)
Historical Stock Chart
From Mar 2023 to Mar 2024