J.P. Morgan Weighs In on UnitedHealth Stock Amid DOJ Scrutiny
Elevate Your Investing Strategy:
Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Thursday's 5% drop was driven by renewed scrutiny over an ongoing legal matter. UNH disclosed that it had proactively reached out to the DOJ following a February Wall Street Journal report revealing a civil investigation into its Medicare Advantage risk-coding practices. In its latest filing, the company confirmed that it is now responding to formal civil and criminal inquiries, has launched its own internal review, and remains cooperative with CMS audits. UNH also pointed to a favorable March ruling from a Special Master in a separate, long-running DOJ civil case as a sign of how past challenges have played out.
This shift from 'unaware' in February to 'proactively cooperating' now isn't surprising to J.P. Morgan analyst Lisa Gill, who views the company's engagement as part of a broader defense of its practices.
'While we are not lawyers,' Gill noted, 'we note that if the court were to view this case similarly to previous ones brought forth by DOJ regarding the False Claims Act (FCA), we believe that this would place the burden of proof on the DOJ to prove improper coding.'
Though the investigation has added another layer of uncertainty, Gill contextualizes it within broader industry trends. The analyst points to risk-adjustment programs like RADV and regulatory updates like V28 as ongoing efforts to refine coding practices across the Medicare Advantage landscape. Viewed through that lens, the current probes may ultimately reflect how companies have adapted, rather than acted improperly.
Still, Gill acknowledges the ambiguity facing investors. The company's filing offers limited detail, and any legal proceedings stemming from the DOJ's inquiries are likely to be drawn out. Much could hinge on the outcome of the ongoing DOJ-backed civil case – one in which the Special Master recently recommended dismissal due to lack of evidence, though the DOJ has challenged that recommendation.
In the meantime, Gill is looking ahead to next week's earnings call for added clarity, and remains optimistic. The analyst assigns UNH an Overweight (i.e., Buy) rating and $418 price target, suggesting the stock could rebound by 48% over the next 12 months. (To watch Gill's track record, click here)
And she's not alone. 17 other analysts share Gill's bullish outlook, while 5 remain on the sidelines and just one is bearish. Altogether, the stock carries a Moderate Buy consensus rating. The average price target stands at $348.12, implying a ~24% upside from current levels. (See UNH stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
25 minutes ago
- Yahoo
3 High-Yield Energy Stocks That Can Survive in Today's Fast-Changing Energy Landscape
Key Points Chevron just scored a big win, highlighting the strength of the energy giant's business model. Energy Transfer is a solid stock to buy now and hold for the long term. ExxonMobil built its business to thrive in all market conditions. 10 stocks we like better than Chevron › The energy market changes rapidly. Crude prices initially rallied into the $80s to start this year. However, oil soon reversed course, plunging into the $60s on tariff-driven concerns. While oil prices bounced off that bottom, it's anyone's guess where crude prices will go next. Given how quickly things can change in the energy market, many companies have taken steps to ensure they can survive the industry's ups and downs. Chevron (NYSE: CVX), Energy Transfer (NYSE: ET), and ExxonMobil (NYSE: XOM) stand out to a few contributing analysts for their ability to handle whatever the market throws their way. That makes them ideal options for those seeking attractive and durable dividend income. Chevron is built to survive anything that comes its way (Chevron): There's one feature that investors shouldn't overlook about Chevron: its balance sheet. With a debt-to-equity ratio of around 0.2 times at the end of the second quarter, it has one of the strongest financial positions among its integrated energy peer group. Most of the time, investors pay more attention to oil prices and geopolitical events than to balance sheets. But Chevron's ability to survive whatever comes its way is partly tied to its financial strength. For example, Chevron just completed the acquisition of Hess for roughly $53 billion. Inking a deal of that scale requires both size and financial strength. But here's the interesting thing: The deal was agreed upon back in October 2023! The transaction was bogged down in the courts because of Hess' relationship with Chevron's peers. Few companies could have afforded to stick around, regardless of how attractive the deal was, for as long as Chevron did. And the energy giant's balance sheet strength was a key factor in its resilience to the headwinds the deal faced. But that's not the only place where a strong balance sheet has been a huge benefit. Oil prices are highly volatile, leading to material swings on the top and bottom lines for a company like Chevron. And yet, Chevron has managed to increase its dividend annually for 38 consecutive years. How? It has the balance sheet capacity to add debt during the hard times so it can muddle through until the good times return (at which point it reduces leverage again). With an attractive 4.7% dividend yield, even conservative investors should appreciate Chevron's ability to weather all the storms that have come its way for 38 years and counting. A promising high-yield stock with big plans Neha Chamaria (Energy Transfer): These are challenging times to be an investor in the energy sector. Oil prices are volatile, and the global energy landscape is changing in favor of cleaner energy sources. Unlike crude oil and coal, however, the demand for natural gas is projected to rise steadily in the coming decades, driven by growing demand for electricity, among other things. Given the dynamics, a stock like Energy Transfer not only can survive in today's changing landscape but also thrive in the long term. That's because Energy Transfer is a massive natural gas player that generates steady cash flows and pays big dividends. Energy Transfer operates over 130,000 miles of pipeline. Over 50% of its projected growth capital expenditures of $5 billion for 2025 will be spent on natural gas pipelines and natural gas liquids capacity expansions. It's also constructing eight natural-gas-fired power-generation plants to support its operations in Texas. The company recently bagged its first commercial deal to supply natural gas to Texas data centers. Energy Transfer, therefore, has strong growth catalysts and the financial fortitude to back its growth plans. The company also pays a steady dividend and is targeting 3% to 5% annual dividend growth in the long term. When combined with a high yield of 7.4%, Energy Transfer stock makes for a compelling buy case today. Built to thrive in any energy market Matt DiLallo (ExxonMobil): ExxonMobil built its business not to survive but to thrive in the rapidly changing energy market. The energy giant has an unmatched global portfolio of low-cost upstream oil and gas production assets complemented by a leading products solutions business (refining, chemicals, and specialty products). Exxon is also building a growing low-carbon solutions business. These businesses are delivering strong and growing earnings even in the face of continued commodity price volatility. For example, last year was Exxon's third-most profitable year in the past decade, despite commodity prices hovering toward the low end of their historical range for the most part. The company's growing scale gives it a significant competitive advantage, enabling it to leverage its size and reduce costs. Since 2019, ExxonMobil has achieved $12.1 billion in annual cost savings, and it projects total annual cost savings to reach $18 billion by 2030. Those continued cost savings will put it in an even stronger position to weather changes in the oil market. Exxon also boasts one of the strongest balance sheets in the energy sector. This gives it the flexibility to borrow money during periods of lower oil prices, allowing it to continue funding its growth. It repays that debt when commodity prices improve. The oil giant's combination of low costs, scale, and balance sheet strength puts its dividend (which yields over 3.5%) on a very sustainable foundation. The oil giant has increased its payout for 42 consecutive years, a feat achieved by only 4% of companies in the S&P 500. Exxon expects to achieve $20 billion in earnings growth and $30 billion in cash flow growth by 2030. These targets represent compound annual growth rates of 8% for earnings and 10% for cash flow, based on an average oil price of $65 per barrel, which is below current market levels. This should provide the oil giant with ample fuel to continue increasing its high-yielding dividend. This combination of financial strength and visible growth puts ExxonMobil in an excellent position to excel in today's shifting energy market. Should you buy stock in Chevron right now? Before you buy stock in Chevron, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Chevron wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,063,471!* Now, it's worth noting Stock Advisor's total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Matt DiLallo has positions in Chevron and Energy Transfer. Neha Chamaria has no position in any of the stocks mentioned. Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron. The Motley Fool has a disclosure policy. 3 High-Yield Energy Stocks That Can Survive in Today's Fast-Changing Energy Landscape was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
2 hours ago
- Yahoo
Labcorp Holdings Second Quarter 2025 Earnings: Revenues Beat Expectations, EPS Lags
Labcorp Holdings (NYSE:LH) Second Quarter 2025 Results Key Financial Results Revenue: US$3.53b (up 9.5% from 2Q 2024). Net income: US$237.9m (up 16% from 2Q 2024). Profit margin: 6.7% (up from 6.4% in 2Q 2024). The increase in margin was driven by higher revenue. EPS: US$2.85 (up from US$2.44 in 2Q 2024). Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. All figures shown in the chart above are for the trailing 12 month (TTM) period Labcorp Holdings Revenues Beat Expectations, EPS Falls Short Revenue exceeded analyst estimates by 1.2%. Earnings per share (EPS) missed analyst estimates by 12%. Looking ahead, revenue is forecast to grow 4.5% p.a. on average during the next 3 years, compared to a 6.3% growth forecast for the Healthcare industry in the US. Performance of the American Healthcare industry. The company's shares are up 8.7% from a week ago. Risk Analysis You should learn about the 2 warning signs we've spotted with Labcorp Holdings. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
2 hours ago
- Yahoo
Integer Holdings' (NYSE:ITGR) earnings growth rate lags the 11% CAGR delivered to shareholders
While Integer Holdings Corporation (NYSE:ITGR) shareholders are probably generally happy, the stock hasn't had particularly good run recently, with the share price falling 12% in the last quarter. But at least the stock is up over the last five years. Unfortunately its return of 65% is below the market return of 100%. While the stock has fallen 3.5% this week, it's worth focusing on the longer term and seeing if the stocks historical returns have been driven by the underlying fundamentals. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time. During five years of share price growth, Integer Holdings achieved compound earnings per share (EPS) growth of 1.4% per year. This EPS growth is slower than the share price growth of 11% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. That's not necessarily surprising considering the five-year track record of earnings growth. This optimism is visible in its fairly high P/E ratio of 45.37. The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image). It might be well worthwhile taking a look at our free report on Integer Holdings' earnings, revenue and cash flow. A Different Perspective While the broader market gained around 19% in the last year, Integer Holdings shareholders lost 7.1%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 11%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For instance, we've identified 3 warning signs for Integer Holdings (1 doesn't sit too well with us) that you should be aware of. Of course Integer Holdings may not be the best stock to buy. So you may wish to see this free collection of growth stocks. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
