UnitedHealth Tops Views, Boosts Outlook
October 18 2016 - 7:18AM
Dow Jones News
By Joshua Jamerson
UnitedHealth Group Inc. boosted its earnings outlook for the
year as it posted strong profit growth in the latest quarter on
climbing revenue across its segments.
The Minnetonka, Minn., company now expects adjusted earnings for
the year of about $8 a share compared with its previous forecast of
$7.80 to $7.95 a share.
The health-care delivery businesses drove growth at Optum, its
health-services unit, where revenue rose 9% to $21.1 billion. The
business has benefited from UnitedHealth's acquisition of
pharmacy-benefit managerCatamaran Corp., which was completed in
July 2015.
Meanwhile, the insurer's medical-cost ratio -- the percentage of
premiums paid in claims -- decreased 60 basis points year-over-year
to 80.3% in the third quarter.
UnitedHealth said revenue from its employer-based and individual
plans rose 12% to $13.3 billion in the period. It said growth from
employer-sponsored groups offset decreases in individual benefit
coverage, but otherwise the company didn't detail performance of
its plans' part of the Affordable Care Act. UnitedHealth has said
it would leave many markets in which it currently sells plans on
government-run exchanges next year, and previously said it
anticipates losing about $850 million on the plans this year.
The largest U.S. health care insurer and the first to report
earnings, UnitedHealth is typically viewed as a bellwether for the
industry.
Over all, UnitedHealth reported a profit of $1.97 billion, or
$2.03 a share, up from $1.6 billion, or $1.65, a year earlier.
Excluding certain items, earnings rose to $2.17 a share from
$1.77.
Revenue climbed 12% to $46.29 billion. Analysts had projected
adjusted earnings of $2.08 a share on revenue of $46.09 billion,
according to Thomson Reuters.
Shares in the company have risen 12% in the past 12 months and
were inactive premarket.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
October 18, 2016 07:03 ET (11:03 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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