UNH will go UP
$66.00 on 7/21/12
$121.40 (104.00% from time of market call)
United Healthcare (UNH) is a managed care company in the health sector. This means that it watches over health care costs for people enrolled in its system. This is accomplished through the hiring of accomplished professionals, who have had previous medical experience as well as M.Ds, to manage cases accordingly. In addition, an even mix of business professionals are included to successfully manage other aspects of this company.
UNH recently announced corporate earnings of $1.31 per share, easily trouncing the expected $1.16 valuation consensus among analysts. Strong earnings signify a great start to this year's profits, always a bonus for any companies.
By buying out Monarch Doctor Group in Southern California, United Healthcare now poses a viable threat to groups in California such as Kaiser Permanente and Blue Cross. The fact that it is able to expand in these areas is a testament to UNH's progress. Bear in mind that United Healthcare still remains strong with its roots in the eastern US as well, so a strong profit base allows expansion into Southern California to be validated.
All of this translates to UNH's recent rise to $59 per share (as of 4/20/12). Targets once placed at $60 have now been raised to $66. My price target is at $66 as well due to the above validation of UNH's rise.