Health insurance company UnitedHealth Group (NYSE:UNH) has had a rally in shares in the third quarter, helped by news of Warren Buffett taking a stake. An earnings report Tuesday before market open could continue the rally or see shares give back some gains.
Here are the earnings estimates, what experts are saying and key items to watch.
Earnings Estimates: Analysts expect UnitedHealth to report third-quarter revenue of $113.06 billion, up from $100.82 billion in last year's third quarter, according to data from Benzinga Pro.
The company has missed analyst estimates for revenue in five straight quarters. Prior to the five straight misses, the company beat analyst estimates for revenue in 15 straight quarters.
Analysts expect UnitedHealth to report third-quarter earnings per share of $2.79, down from $7.15 in last year's third quarter.
The company has missed analyst estimates for earnings per share in two straight quarters, but beaten estimates in seven of the last 10 quarters overall.
Read Also: How To Earn $500 A Month From UnitedHealth Group Stock Ahead Of Q3 Earnings
What Experts are Saying: Many analysts have been raising their price targets on UnitedHealth Group stock ahead of quarterly earnings.
One analyst who is more cautious is Baird analyst Michael Ha, who warned about the company's Optum Health division on a podcast in September.
The analyst said United's Optum Health segment could see headwinds with government changes to Medicare Advantage. Ha said changes to the Medicare & Medicaid Services plans are being phased in over three years.
"The impact alone from V28… It's $11 billion over three years," Ha said.
The analyst said the changes could "structurally impair Optum Health."
Ha has an Underperform rating on UnitedHealth.
Freedom Capital Markets Chief Market Strategist Jay Woods said UnitedHealth stock has been trading higher with increased confidence after Berkshire Hathaway Inc (NYSE:BRK) (NYSE:BRK) unveiled a stake in the company in its second quarter 13F filing.
"Since that announcement shares have rallied over 30% but are still 44% below their November 2024 highs and have struggled after their last four quarterly earnings reports," Woods said in a weekly newsletter.
Woods noted that the stock has declined by an average of about 10% following each of its last four quarterly earnings reports.
With a CEO resignation, earnings misses, and a Department of Justice investigation into Medicare billing practices, Woods says the once mighty Dow Jones stock has had several black eyes this year.
Woods says, "The chart is just a disaster" when looking at the technicals for UnitedHealth stock.
"The gaps are everywhere and must be watched."
Here are other recent analyst ratings on UnitedHealth and their price targets:
- Jefferies: Maintained Buy rating, raised price target from $317 to $409
- Goldman Sachs: Initiated with Buy rating with price target of $406
- JPMorgan: Maintained Overweight rating, raised price target from $310 to $425
- Mizuho: Maintained Outperform rating, raised price target from $300 to $430
- Barclays: Maintained Overweight rating, raised price target from $350 to $386
Key Items to Watch: Buffett's stake in UnitedHealth could turn into a question of validation during the company's earnings call, with one of the top investors in the world betting on a potential turnaround of a beaten-down stock.
Buffett unveiled a 5,039,564 share position in the second quarter. In mid-November, investors will learn whether the position size changed in the third quarter.
Benzinga previously shared that Buffett's stake has increased since the end of the second quarter. As of Monday, the position is now worth $1.84 billion and is up $264.22 million since the end of the second quarter.
While Berkshire Hathaway shares may not move much based on the price action of UnitedHealth stock, given its relatively small position in the investing portfolio, one of the largest U.S. stock indexes could see major movement on Tuesday.
In the price-weighted Dow Jones Industrial Average, UnitedHealth is the fifth-largest stock, which could make the index volatile based on trading action in the health insurance stock. UnitedHealth is the fifth largest weighting in the SPDR Dow Jones Industrial Average ETF (NYSE:DIA), which tracks the index, at 4.72% of assets.
One area for investors and analysts to watch will be any commentary on recent pressure on insurance companies and drug companies over pricing by the White House administration. The White House's proposed TrumpRx platform could offer discounts to Medicaid plans.
United's Optum Rx currently makes money on higher prices for drugs, collecting the "spread," or difference in list prices and net prices on drugs. With fewer rebates, the company could see thinner margins for this division.
Health insurance companies have been under pressure on prices for years, and the latest push could hurt UnitedHealth’s long-term outlook.
The company saw increases in customer counts in several segments in the second quarter, with investors and analysts likely looking for similar trends in the third quarter.
Analysts and investors will also be looking at guidance, after the company suspended its 2025 performance outlook earlier this year and then reestablished some guidance figures following second-quarter results.
UNH Price Action: UnitedHealth stock trades at $364.40 on Monday versus a 52-week trading range of $234.60 to $630.73. UnitedHealth stock is down 27.8% year-to-date in 2025.
Read Next:
Image created using artificial intelligence via Midjourney.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
