The last few months have featured quite a few changes for healthcare stock UnitedHealth (NYSE:UNH). Most recently, it ended one merger deal and went into a new merger with a completely different operation. All these mergers and broken mergers likely left shareholders a bit confused but also optimistic, as UnitedHealth closed slightly higher in Monday’s trading.
Most recently, UnitedHealth set up a new merger with Amedisys (NASDAQ:AMED), and cut off its old merger deal with Option Care Health (NASDAQ:OPCH). The new merger, meanwhile, calls for UnitedHealth to buy up all of Amedisys’ outstanding common stock for $101 per share. That puts Amedisys, in its entirety, as part of Optum at UnitedHealth. Meanwhile, the termination of the previous merger deal with Option Care Health comes with a $106 million termination fee.
This isn’t UnitedHealth’s first plunge into mergers and acquisition action; back in February, UnitedHealth closed a merger deal with LHC Group, in a deal worth $5.4 billion. LHC also became part of the Optum subsidiary, which gave UnitedHealth a greater presence in value-based home care. Given what we know about the aging population of the United States—roughly 17% of the United States population is now over the age of 65—that’s a move that will likely give UnitedHealth a nicely boosted bottom line as well.
Of the three aforementioned stocks, only Amedisys was down in Monday afternoon’s trading. It’s also got the weakest upside potential. With an average price target of $94.09, Amedisys stock—a Hold by analyst consensus—offers just a 3.53% upside potential. Meanwhile, Strong Buy UnitedHealth’s average price target of $589.72 gives it a 22.73% upside potential.
