UnitedHealth Group Inc. (UNH) - Get Report posted stronger-than-expected third quarter earnings Wednesday, and boosted its full-year profit forecast, as its Optum division continued to pace gains for the health care provider.
Shares fell in early trading, however, after the group told investors on a conference all that the ongoing coronavirus pandemic added further uncertainty to its 2021 outlook.
UnitedHealth said adjusted profits for the three months ending in September were pegged at $3.51 per share, down 9.5% from the same period last year but firmly ahead of the Street consensus forecast of $3.10 per share. Group revenues, UnitedHealth said, rose 7.8% to $65.1 billion, again beating analysts' forecasts of a $63.9 billion tally.
Looking into the second half of the year, UnitedHealth said it sees 2020 adjusted profits of between $16.50 to $16.75 per share, a figure tops its prior forecast of a range of $16.25 to $16.55 per share.
“The people of UnitedHealth Group continue to deliver more innovative and modern solutions for customers, physicians and consumers, while responding to the needs of the people and communities affected by the pandemic,” said CEO David Wichmann. “We’re encouraged to see those we serve respond to the incentives we offered to safely seek care as the health system continued to recover in the quarter.”
UnitedHealth shares were marked 1.6% lower in early trading immediately following the earnings release to change hands at $326.48 each, a move that trims the Dow component's six-month gain to around 20%.
UnitedHealth said third quarter earnings were led by Optum and the UnitedHealthcare public-sector and senior benefits businesses, even as the it saw "its expansive COVID-19 response efforts supporting patients, care providers, customers and communities."
Revenues at Optum, its pharmacy benefits management business, rose 21% to $34.9 billion while the division's bottom line rose 8.33% to $2.6 billion.