Down More Than 20% in the Last Month, Is UnitedHealth Stock a Buy on the Dip?
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UnitedHealth (UNH) was hammed with bad news in May, resulting in a more than 20% decline in its stock price last month.
The healthcare giant has suspended its guidance for the full year and was also accused recently of secretly paying nursing homes to minimize hospitalizations.
Versus its year-to-date high in early April, UnitedHealth shares are currently down some 50%.
UnitedHealth Stock Is Trading at a Historically Discounted Valuation
Amidst the turmoil, Deutsche Bank analyst George Hill sees opportunity in UNH shares.
In his latest research note, Hill favored buying UnitedHealth stock on recent weakness primarily because its earnings multiple now sits well below the giant’s 10-year trading range.
“We’re hanging our gloves on valuation. Even a trough-ish multiple on our expected 2025 trough earnings still implies meaningful upside to the shares,” the analyst wrote.
Deutsche Bank continues to rate the healthcare stock at “Buy” with a target of $362 that translates to 20% upside from current levels.
KeyBanc Expects UNH Shares to Be Free of Headwinds by Early 2026
George Hill dubbed UnitedHealth a “defensive name in the large-cap healthcare services space” and said its core managed care business could grow operating profit by up to 5% as Medicare Advantage plans mature.
More importantly, his peers at KeyBanc also remain bullish on UNH shares with an even more generous price target of $400.
On Monday, the investment firm acknowledged that UnitedHealth stock is mired in headwinds at the time of writing, but said many of them will resolve by early next year, making the overall setup attractive for the next 12 months.
Finally, investors could take heart in the fact that UnitedHealth insiders are buying the company’s stock following recent crash as well.
Wall Street is Sticking to Its Positive View on UnitedHealth
Wall Street analysts are aligned in their view on UnitedHealth stock for the back half of 2025.
The consensus rating on UNH shares currently sits at “Strong Buy” with the mean target of about $392 indicating potential upside of nearly 30% from here.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.