UnitedHealth Group (UNH): Is the Stock Overvalued or Undervalued After Modest Recent Gains?

UnitedHealth Group (UNH) shares have edged slightly higher recently, gaining about 1.5% in the past day and 2% for the week. Investors are keeping an eye on the company’s ongoing performance in light of broader healthcare sector trends.

See our latest analysis for UnitedHealth Group.

Over the past year, UnitedHealth Group’s share price has seen only modest movement, and its one-year total shareholder return sits a shade below flat. This points to a period of subdued momentum despite the company’s solid operations and recent sector shifts.

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With shares treading water and company fundamentals remaining solid, investors are left wondering if UnitedHealth Group is quietly undervalued or if Wall Street is already factoring in future growth, leaving little room for upside.

Most Popular Narrative: 3% Overvalued

UnitedHealth Group’s narrative fair value estimate (at $342.58) sits just below its last close price of $353.72. This suggests shares are slightly ahead of the consensus long-term outlook. With outlook recalibrations and sector volatility still in play, the most watched analyst narrative sets an exacting bar for what comes next.

Updates highlight management’s reaffirmation of 2025 earnings guidance and a "stable" long-term outlook through 2027, with increased confidence in a longer-term earnings rebound driven by operational improvements in Optum Health.

Read the complete narrative.

Curious why the most-followed narrative barely nudges fair value above today’s price? One crucial detail: the analysts betting on a rebound are also assuming a major overhaul in key financial drivers. Dive in to see which bold assumptions underpin this tight call on UnitedHealth's future valuation.

Result: Fair Value of $342.58 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, unexpected increases in Medicare care utilization or execution missteps related to the new CMS risk model could challenge the bullish outlook for UnitedHealth Group.

Find out about the key risks to this UnitedHealth Group narrative.

Another View: What If the SWS DCF Model Is Right?

While analysts see UnitedHealth Group as slightly overvalued on price-to-earnings, our DCF model tells a different story. The DCF approach estimates fair value at $867.30, suggesting shares could be deeply undervalued if long-term cash flows play out as forecast. Which method will the market trust?

Look into how the SWS DCF model arrives at its fair value.

Build Your Own UnitedHealth Group Narrative

If you see things differently or want to dig into the numbers yourself, you can craft a personalized take in just a few minutes. Do it your way.

A great starting point for your UnitedHealth Group research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This 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.

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