UnitedHealth Group (UNH): Rethinking Valuation After Berkshire Hathaway’s Big Bet and Ongoing Regulatory Scrutiny

If you are staring at UnitedHealth Group (UNH) in your portfolio, you are not alone. Wall Street is abuzz following word that Berkshire Hathaway scooped up a substantial stake. The timing is striking, given that UNH is still facing scrutiny over its Medicare billing practices from an ongoing Department of Justice investigation. Despite this cloud, Berkshire’s bet, along with strong institutional signals, has put new energy into the conversation about UNH’s future.

It is no wonder investors are re-evaluating their stance. UNH shares, while down sharply over the past year, have staged a partial rebound in the last month, gaining momentum just as the news broke. This comes atop continued chatter about quarterly dividends, leadership changes, and buzz around AI-driven efficiency gains, all fueling fresh debates on the stock’s risk and recovery path.

With sentiment on the rise and major players entering the mix, is UnitedHealth Group now undervalued, or are markets already pricing in its next chapter of growth?

Most Popular Narrative: 3.6% Undervalued

The most widely followed valuation narrative suggests UnitedHealth Group is trading at a modest discount to its fair value based on future growth and profitability expectations.

The company is addressing unanticipated changes in Medicare membership profiles that impacted 2025 revenue. They are taking measures to ensure complex patients engage in clinical and value-based programs, which should help stabilize and potentially increase future revenue.

Curious why analysts see hidden upside? There is one key set of financial projections driving this favorable valuation. This approach blends long-term revenue ambitions with a profit profile not currently visible in this year’s numbers. Want to uncover which surprising assumptions could reshape how the stock is viewed? The real story is in the narrative details that do not appear on headline financials.

Result: Fair Value of $327.29 (UNDERVALUED)

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

However, unexpected increases in care usage and complications with Medicare transitions could quickly undermine the optimism around UnitedHealth Group’s projected recovery.

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

Another View: What Does Our DCF Model Say?

While many rely on analyst forecasts and traditional measures, our SWS DCF model looks deeper into UnitedHealth Group’s cash flow potential. Interestingly, the model reaches an even more optimistic conclusion. Could market sentiment be missing a bigger opportunity?

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

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out UnitedHealth Group for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own UnitedHealth Group Narrative

If you want to challenge these conclusions or trust your own analysis more, you can dig into the numbers firsthand and put together your own perspective 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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