By Senad Karaahmetovic
Shares of UnitedHealth (NYSE:UNH) are up almost 2% after the company raised its adjusted earnings per share forecast for the full year.
UNH delivered adjusted EPS of $5.57 to easily top the consensus of $5.19. Revenue was reported at $80.33 billion, up 13% year over year and higher than the consensus of $79.62 billion.
The company raised the guidance for adjusted EPS to $21.40-$21.90 from $21.20-$21.70. Analysts were calling for $21.59 per share.
"Growth in 2Q was balanced across the company’s businesses, driven especially by continued strong expansion in people served at UnitedHealthcare and in value-based arrangements at Optum Health,” the company said in a press release.
Goldman Sachs analyst Nathan Rich said the beat was better than expected.
”While we had anticipated favorable medical cost performance given 2Q datapoints from hospitals, the upside was greater than we had expected and with utilization seemingly still modest, we remain positive on the earnings opportunity in the back half despite 2022 guidance being raised by less than the beat (likely conservatism). On the call, we look for commentary on 2H enrollment/utilization expectations in a softer macro environment as well as drivers of the OptumHealth margin performance,” Rich said in a client note.
BMO analyst Matt Borsch described the results as “strong/good quality with no significant issues or weak areas.”
“The MCR clearly implies moderate medical cost trend. While expected, that should bode well for the rest of managed care earnings season,” the analyst added.