UnitedHealth Raises 2018 Earnings Forecast -- WSJ
July 18 2018 - 03:02AM
Dow Jones News
By Kimberly Chin and Anna Wilde Mathews
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (July 18, 2018).
UnitedHealth Group Inc. on Tuesday raised its full-year earnings
outlook as the company continued to see growth in health plan
membership and premiums.
The parent of the nation's largest health insurer earned $2.92
billion, or $2.98 a share, in the second quarter, up from $2.28
billion, or $2.32 a share, in the year-earlier period. On an
adjusted basis, UnitedHealth's profit rose to $3.14 a share.
Analyst polled by Thomson Reuters were expecting $3.04 a share.
Analysts said the earnings beat was fueled largely by
non-operating factors, particularly a tax rate that was lower than
some had estimated. The second quarter "seems mostly in-line with
tax rate driving upside," Wells Fargo analyst Peter Costa wrote in
an investor note.
During the earnings call, analysts zeroed in on the insurance
arm's medical loss ratio, which reflects the share of premiums that
go toward health-care costs. The ratio was slightly worse than some
analysts projected.
UnitedHealth said the result met its expectations, and it hadn't
changed its full-year projection. The company did flag an uptick in
health-care utilization in its Medicare business, but said this was
expected and not a change from last year. The uptick is tied to
rapid enrollment growth, UnitedHealth said.
Overall, revenue rose 12% to $56.1 billion, boosted by
membership growth in its health-insurance arm, as well as continued
expansion in its Optum health-services segments. Analysts were
expecting revenue of $56 billion. Revenue from its UnitedHealthcare
segment rose 12% to $45.8 billion.
This year UnitedHealth guided adjusted per-share earnings
between $12.50 and $12.75, up from its prior forecast between
$12.40 and $12.65.
Shares of UnitedHealth fell 3.4% in morning trading.
Corrections & Amplifications UnitedHealth Group profits beat
analysts' estimates by 10 cents a share. An earlier version of this
article incorrectly stated that profits were in line with
estimates. (July 17)
Write to Anna Wilde Mathews at anna.mathews@wsj.com
(END) Dow Jones Newswires
July 18, 2018 02:47 ET (06:47 GMT)
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