TLDR
- Wells Fargo raised UnitedHealth Group’s price target to $400 from $267, maintaining an Overweight rating based on long-term earnings recovery expectations.
- Bernstein increased its price target to $433 from $379 ahead of Q3 earnings, citing attractive valuation and projected earnings growth over the next four years.
- UNH stock has climbed 18% over the past three months as investors grow more optimistic about the company’s recovery prospects.
- Analysts expect improving Medicare Advantage margins and strong performance from Optum divisions to drive future earnings growth.
- UnitedHealth is scheduled to report Q3 results on October 28, with analysts expecting EPS of $2.81 on revenue of $113.14 billion.
UnitedHealth Group has caught the attention of Wall Street analysts in recent weeks. Two major firms raised their price targets on the healthcare giant as optimism builds around its recovery trajectory.
Wells Fargo analyst Stephen Baxter lifted his price target to $400 from $267. He maintained an Overweight rating on the stock. The new target represents about 9% upside from current trading levels.
Bernstein took an even more bullish stance. The firm raised its price target to $433 from $379 while keeping an Outperform rating. Both analyst moves come as UNH shares have gained 18% over the past three months.
The stock currently trades at a P/E ratio of 15.75. Over the last twelve months, the company generated more than $25 billion in free cash flow. Revenue growth came in at 9.7% during that period.
Baxter pointed to improving margins as a key driver of his increased confidence. He sees UnitedHealth as one of the stronger players in managed care. The company’s focus on margin improvement is starting to show results, particularly in its Medicare Advantage business.
Medicare Advantage and Optum Performance
Medicare Advantage margins remain central to UnitedHealth’s profitability outlook. Analysts expect these margins to recover from what Bernstein described as trough levels following rate pressures and competitive changes in the market.
The company’s Q2 results showed revenue of $111.62 billion, slightly above the $111.59 billion estimate. Optum, the health services division, brought in $67.2 billion in revenue for the quarter. That marked a 6.8% increase year over year.
Optum includes three main divisions: Optum Health, Optum Insight, and Optum Rx. These units cover health services, data analytics, and pharmacy operations. Baxter expects both Optum and Medicare Advantage to play major roles in driving earnings recovery over the coming years.
Star ratings for Medicare Advantage plans also factor into the positive outlook. These quality measures determine reimbursement rates from Medicare. Higher ratings would support better payments and help improve profit margins going forward.
UnitedHealth is set to report Q3 earnings on October 28. Analysts expect earnings per share of $2.81 on revenue of $113.14 billion. Bernstein projects adjusted EPS of $2.84 and a medical loss ratio of 90.7% for the quarter.
Recent Performance and Analyst Consensus
The company has faced some headwinds recently. UnitedHealth missed expectations on both earnings and revenue in its April and July 2025 reports. The company hasn’t exceeded revenue estimates since July 2024.
Despite these misses, analyst sentiment remains positive overall. Wall Street shows a Strong Buy consensus rating on UNH stock. This rating comes from 16 Buy recommendations, two Hold ratings, and one Sell rating assigned in the last three months.
The average price target sits at $333.89 according to TipRanks data. That suggests potential downside of 8.19% from current levels. However, individual analyst targets like those from Wells Fargo and Bernstein sit well above this average.
UnitedHealth has maintained dividend payments for 33 consecutive years. The company currently offers a dividend yield of 2.43%. The firm has also announced its 2026 Medicare Advantage plan offerings, which will provide coverage to 94% of eligible beneficiaries.
Leerink Partners also raised its price target for UnitedHealth to $402, maintaining an Outperform rating. UBS held its Buy rating and $378 price target, noting steady management of Medicare Advantage business changes.
