UnitedHealth stock price forecast for Q4 after boosting full-year EPS guidance

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on Oct 14, 2021
  • UnitedHealth shares on Thursday spiked nearly 5% after announcing its most recent quarterly results.
  • The company reported its fiscal Q3 revenue and earnings before markets opened, beating analyst estimates.
  • UNH also boosted its full-year 2021 earnings guidance in line with expectations.

On Thursday, UnitedHealth Group Inc. (NYSE:UNH) shares advanced nearly 5% after announcing its most recent quarterly results. The company reported its fiscal third-quarter, 2021 revenue and earnings before markets opened, beating analyst expectations.UNH also boosted its guidance for the full-year earnings, with the median in line with Street expectations.

The company posted fiscal Q3 non-GAAP earnings per share of $4.52, beating the consensus Street estimate of $4.42. In addition, the company’s GAAP EPS of $4.28, outperformed the average for analyst expectations of $4.20, while revenue for the quarter grew by 11.1% Y/Y to $72.33 billion, $1.09 billion ahead of estimates.

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UnitedHealth shares are up more than 20% this year and nearly 31% over the last 12 months.

UNH valuation and growth

From a valuation perspective, UnitedHealth shares trade at a reasonable trailing P/E ratio of 26.65 and an attractive forward P/E of 18.68. Therefore, value investors could find the stock as an exciting option for their portfolios.

Moreover, analysts seem optimistic about UNH’s growth prospects with an earnings growth forecast of more than 15% for next year. In addition, they also expect the company’s EPS to grow at an average annual rate of nearly 14% over the next five years.

Therefore, UnitedHealth could also be a compelling option for growth investors.

Source – TradingView

Technically, UnitedHealth shares seem to have recently spiked to complete an upward breakout from a descending channel formation. As a result, the stock has advanced to trade above the 100-day moving average in the intraday chart.

However, with shares yet to reach overbought conditions, the current rally could continue for the foreseeable future. Therefore, investors could target extended gains at about $431.42, or higher at $440.06, while $414.43 and $406.07 are crucial support zones.

There is still time to buy UNH

In summary, although UnitedHealth shares are up more than 20% this year, the company’s boosted earnings guidance could push the stock price towards the current 52-week highs of $433.50.

Therefore, with shares yet to reach overbought conditions, it may not be too late to buy the rebound.

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