UNH - UnitedHealthGroup: Cyber Attack Timeline Overview And 2023 Review

2024-03-18 13:05:07 ET

Summary

• UnitedHealth Group's subsidiary, Change Healthcare, was impacted by a cyber attack in February 2024.
• Unfavorable medical expense cost trends present a short-term headwind for UNH.
• UNH managed to beat all of my organic growth expectations in 2023.
• Regulatory risks remain the highest risk for UNH and might hinder the share price to perform in line with UNH's financial results.
• I reiterate my buy rating on UNH. My DCF valuation leaves me to assume that UNH's fair value per share is somewhere around $545 per share.

Introduction

I last covered UnitedHealth Group ( UNH ) in an article published on July 31, 2023, called "UnitedHealth Group: Attractively Priced Compounder But Regulatory Risks Remain". Several months have passed since then and there have recently been several news headlines regarding a cyber attack on Change Healthcare, a subsidiary of UNH's Optum Insights segment. So I think now is a good time to follow up on my initial article, especially since the stock has been flat since it was published.

In this article, I will address the cyber attack and recent trends in the medical care ratio. I will also review UNH's 2023 results....

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