BHG - UnitedHealth Anthem win Buy ratings as Goldman Sachs begins coverage on managed care

Citing a positive outlook for the managed care space, Goldman Sachs has initiated its coverage on 10 companies in the subsector, issuing Buy ratings for five of them, including UnitedHealth (NYSE:UNH) and Anthem (NYSE:ANTM). For the next two years, the analysts Nathan Rich and Lindsay Golub estimate a potential 13% annual earnings per share growth for large-cap managed care organizations, more than double the firm’s ~6% projection for S&P EPS growth. The analysts note that rising interest rates, inflation, and a favorable regulatory setup ahead of midterm elections could be tailwinds for the industry group. Yet, MCOs are hovering nearly in line with their historical five-year discount to the S&P (-18%), they argued. “While UNH is the leader in VBC (value-based care) with the largest TAM, we see several ways to gain exposure along the risk curve,” the duo wrote on UnitedHealth. Meanwhile, the analysts added Anthem (ANTM) to Americas

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UnitedHealth, Anthem win Buy ratings as Goldman Sachs begins coverage on managed care