UNH Stock Soars After Q2 Earnings Beat—Analysts Hike UnitedHealth Price Target for 2025

UnitedHealth Group’s (NYSE: UNH) stock has fallen roughly 44 % year to date, erasing more than $180 billion in market value and pushing the share price back to levels last seen in early 2022. The sell-off has been fueled by a perfect storm of rising medical-cost trends, tighter Medicare Advantage reimbursement rates and two consecutive cuts to 2025 profit guidance, yet many analysts see July 29 as a make-or-break catalyst that could reset the narrative. What’s pressuring UNH now • Medical Loss Ratio (MLR) creep: Utilization in outpatient surgeries and diabetes drugs lifted the Q1 MLR to 86.3 %, versus 82.2 % a year earlier, squeezing margins. • Medicare Advantage headwinds: CMS’s Phase-In rule locks in lower 2025 payment growth, forcing management to slash full-year EPS guidance from $29.75 to $26.50 at the midpoint. • Valuation reset: Leerink and other brokers cut 2025 EPS forecasts to roughly $18–$20, implying a forward P/E of 18×, still rich versus historical averages. Why July 29 matters Management will release Q2 results before the bell on July 29. Consensus points to: • EPS: $4.94, down 27 % YoY • Revenue: $111.6 billion, up 13 % YoY Key metrics to watch 1. Medical cost trend vs. 5.1 % company estimate 2. Updated 2025 EPS range and any color on 2026 recovery trajectory 3. OptumRx specialty-drug growth and OptumHealth margins 4. Share-buyback cadence after the $21 billion Q1 repurchase What the bulls say • Near-term pain, long-term moat: UnitedHealth continues to outpace peers in Medicare Advantage enrollment and boasts 7-year average dividend CAGR above 12 %. • Undervaluation thesis: At ~14× 2026 EPS (street average $29), UNH trades at a discount to its 10-year median multiple of 18×, providing 25–30 % upside if cost trends normalize. What the bears worry about • Structural MLR inflation from GLP-1 weight-loss drugs • Additional CMS rule changes for 2026 • Possible DOJ scrutiny of Optum’s acquisition pipeline Bottom line UNH stock sits at a pivotal juncture. A cleaner quarter and stable cost outlook could trigger a relief rally, while another guidance cut may put fresh 52-week lows in play. With implied volatility pricing a ±7 % move into earnings, traders should brace for heightened swings, but long-term investors may see the current malaise as a chance to accumulate shares of a dominant healthcare insurer at a multi-year discount.