NEW YORK (TheStreet) -- Shares of UnitedHealth Group (UNH) are up 0.95% to $100.40 after Oppenheimer raised its price target to $108 from $94 on full year 2015 guidance delivered in a "bullish tone" at the company's annual investor day held yesterday in New York.
The Minneapolis-based healthcare company issued full year 2015 EPS guidance of $6 to $6.25, up 11% year-to-year versus prior analyst consensus of $6.13, based on revenues of $140.5 billion to 141.5 billion.
"Management appears confident that it can return to its 13% to 16% long-term EPS growth rate in 2016 and beyond. Based on the updated guidance, we are raising our FY2015 EPS estimate to $6.21 from $6.13," Oppenheimer analysts said.
Separately, TheStreet Ratings team rates UNITEDHEALTH GROUP INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate UNITEDHEALTH GROUP INC (UNH) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- UNH's revenue growth trails the industry average of 19.9%. Since the same quarter one year prior, revenues slightly increased by 7.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 31.65% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, UNH should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- UNITEDHEALTH GROUP INC has improved earnings per share by 6.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, UNITEDHEALTH GROUP INC increased its bottom line by earning $5.50 versus $5.28 in the prior year. This year, the market expects an improvement in earnings ($5.65 versus $5.50).
- The current debt-to-equity ratio, 0.54, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that UNH's debt-to-equity ratio is low, the quick ratio, which is currently 0.59, displays a potential problem in covering short-term cash needs.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Health Care Providers & Services industry and the overall market, UNITEDHEALTH GROUP INC's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: UNH Ratings Report