Sterne Agee Analyst Sees Little Upside For UnitedHealth Group

UnitedHealth Group Inc. UNH investors might be hard-pressed to find further gains in the stock, an analyst said Wednesday.

Shares of the company are up nearly 50 percent in the past year, and were trading higher Wednesday on better-than-expected fourth quarter results.

But Sterne Agee's Brian Wright maintained an Underperform rating and $87 target, saying that "continued material upside" for the stock is unlikely.

UnitedHealth changed hands recently at $108.43, up 2.66 percent.

UnitedHealth posted fourth-quarter earnings earlier Wednesday of $1.55 a share, versus Wall Street's expectation of $1.50. Revenue grew more than 7 percent to $33.4 billion. Analysts had forecast $33.1 billion.

The portion of premiums used to pay for patient care, called the medical-cost ratio, fell to 79.8 percent, from 81.2 percent in the year-earlier period.

Chief Executive Stephen Hemsley offered a 2015 outlook roughly in line with expectations and told analysts that the company has "momentum and fewer growth impediments" than in recent years.