Top insiders at healthcare major UnitedHealth Group (NYSE:UNH), including its Chair, sold shares worth over $100 million before news of a Department of Justice (DoJ) probe into the company’s business practices became public in February. Meanwhile, the company’s hacking woes don’t seem to be going away anytime soon.
Insider Actions
The DoJ initiated a probe into UnitedHealth in October 2023. According to Bloomberg, Stephen Hemsley, the Chairman of UNH, along with three senior executives at the company, offloaded shares to the tune of $101.5 million over a period of four months prior to the investigation becoming public.
Normally, executives at a public company can trade its shares during specific windows after it reports earnings. However, these trades can be restricted in cases of major investigations. Surprisingly, this was not the case at UNH. The Department of Justice (DOJ) is investigating UNH for potential violations of antitrust norms, yet the company has not publicly acknowledged the investigation.
Hacking Woes
In addition to the DoJ investigation, a major cyberattack on UNH’s subsidiary, Change Healthcare, is weighing on its shares. The cyberattack, orchestrated by the hacking group ALPHV/BlackCat, resulted in payment disruptions to doctors and healthcare facilities. In response, UNH provided loans totaling over $3.3 billion to impacted care providers. The U.S. Health Department is also investigating the attack to determine if there was a breach of protected health data.
This week, another hacking group called Ransomhub claimed to have access to UNH’s stolen data. However, the group has not provided any evidence to substantiate its claims so far.
Is UNH a Good Buy Right Now?
Amid these challenges, UNH’s share price has plummeted by nearly 14% so far this year. Overall, the Street has a Strong Buy Consensus rating on the stock, alongside an average UNH price target of $591.29. At the same time, the Tipranks Insider Trading tool indicates a negative insider confidence signal in UNH stock.
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