Additional Coverage:
- UnitedHealth’s earnings shock is tanking the entire health insurance industry (businessinsider.com)
UnitedHealth’s stock plummeted as much as 24% on Thursday, dragging down other health insurance stocks, after the company issued a disappointing 2025 outlook. The drop followed a surprising first-quarter earnings report, marking the first time in over a decade that UnitedHealth missed profit forecasts. The company also lowered its future projections, a rare move for the insurer, which typically revises its forecasts upwards.
The downturn impacted other health insurers, with several experiencing significant losses. Humana fell 7.3%, Alignment Healthcare dropped 5.8%, and CVS declined 1.2%.
Cigna and Clover Health experienced smaller dips, losing 0.6% and 0.5% respectively. Medicaid-focused managed care providers also saw declines, with Centene down 1.6%, Molina Healthcare losing 2.3%, and Elevance Health falling 2.1%.
UnitedHealth cited unexpectedly high costs associated with its Medicare business as the reason for the disappointing performance. The company explained that increased care activity among Medicare Advantage users significantly exceeded expectations. CEO Andrew Witty acknowledged the company’s underperformance, stating that they are actively addressing the challenges to regain their long-term earnings growth target of 13% to 16%.
Read More About This Story:
- UnitedHealth’s earnings shock is tanking the entire health insurance industry (businessinsider.com)