Insiders Bang the Drum on UnitedHealth Stock; Top Analyst Says ‘Buy’

UnitedHealth Group (NYSE:UNH) shares were in meltdown mode for most of last week. Even after a rebound in Friday’s session, by the end of the week’s trading, the week’s losses stood at 23% with the year-to-date losses reaching 42%.

The downturn kicked off after the company announced leadership changes following the sudden resignation of CEO Andrew Witty, which was attributed to personal reasons. Simultaneously, the healthcare giant pulled its 2025 guide, just weeks after cutting its profit forecast. The situation deteriorated further on Wednesday when a Wall Street Journal report disclosed that the Department of Justice is investigating the company for possible Medicare fraud.

But as investors were turning away in droves, the UNH insiders evidently sensed an opportunity. By insiders, we’re referring to the board and C-suite members – the corporate officers responsible for running the company. While these in-the-know types will often sell shares for various reasons, there’s only one reason for them to buy their own company stock: they must think the shares are undervalued. In fact, looking at the insiders’ recent actions, it’s fair to say they feel pretty confident about where the business is going.

New CEO Stephen Hemsley wasted no time showing his confidence; just days after taking hold of the reins, he purchased 86700 UNH shares, worth a little over a cool $25 million. CFO John Rex bought 17,200 shares, forking out $5 million on the purchase. Director Gil Kristen joined the party, too, buying 3,700 sahres for over $1,000,000. Timothy Patrick Flynn, another Director, threw his weight behind 1,533 shares, spending ‘merely’ $491,786 in the process.

So, multiple votes of confidence from the company’s top brass. All this activity likely makes sense to Mizuho analyst Ann Hynes, given she thinks the share price drop makes the risk/reward attractive.

“UNH historically trades at least two turns higher and up to a five-turn premium to the managed care group given growth versus peers and the diversification of the Optum business,” the 5-star analyst said. “Although the company is facing unprecedented headwinds in the near-term, we believe the pricing and underwriting cycles for managed care should improve over the next two years that better reflect the underlying healthcare utilization environment.”

“Additionally,” Hynes went on to add, “we believe margins in OptumHealthcare should recover over time, but that potential upside is not reflected in current multiples. More importantly, the company’s Optum segment is still a competitive differentiator and a business that generates a lot of unregulated cash versus the insurance business, which is subject to state statutory capital requirements. Over time, we believe the stock should benefit from a recovery in its multiple, at least to its ‘low’ ten-year trading average of 15.9x.”

Hynes anticipates the next catalyst for the stock will be the possible reinstatement of guidance, which she expects to occur in July with the release of the 2Q25 results.

Bottom line, Hynes is backing UNH with an Outperform (i.e., Buy) rating and a $350 price target, pointing to a potential 15% upside from where the stock sits today. (To watch Hynes’ track record, click here)

Wall Street’s outlook is even more upbeat. With an average price target of $404.04, analysts see shares climbing 33% in the months ahead. Backed by 20 Buys against just 6 Holds, UNH earns a confident Strong Buy consensus. (See UNH stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.