Piper Sandler is bullish on UnitedHealth, which she says is a leader in the healthcare delivery industry. The firm initiated coverage with an overweight rating and a $580 price target, meaning the stock would rise 21.4% from where it closed on Thursday. UnitedHealth is operated by UnitedHealthcare and Optum. Launched in 2011, Optum is a complementary business to UnitedHealthcare. It includes services such as healthcare delivery and depository banking under its Optum Health division, in addition to the analytics and pharmacy services segment under Optum Insights and Optum Rx. UNH YTD mountain UNH in 2023 “UNH is a healthcare behemoth that contributes 7.7% of US healthcare spending today from its UnitedHealthcare and Optum segments. We expect UNH to deliver $28.19 in adjusted EPS in FY24 , representing 13.7% year-over-year growth,” analyst Jessica Tassan wrote in a note Thursday. “However, the future resides with Optum,” she added. “Over the next decade, we believe Optum Health, Optum Insight and Optum Rx will increasingly serve as gateways to UNH,” she added. Tassan added that UnitedHealthcare has been the largest premium payer in the US health insurance market for the past 10 years and is well positioned for growth. “UNH has been innovating its way to market leadership for decades. We believe that the breadth and scope of[s] UnitedHealthcare’s risk selection benefits; consumer influence; supply chain efficiency; network rates; and distribution,” Tassan said. “These benefits mean UnitedHealthcare can [repeatedly] to offer market-leading products at highly competitive prices.” The stock is down nearly 10% year-to-date. It has also lost more than 4% over the past 12 months. — CNBC’s Michael Bloom contributed to this report.
