UnitedHealth Group Inc. (NYSE: UNH), the US’s largest health insurer, is currently trading at an historically low valuation.
Jim Cramer, a renowned investor, cautions against buying UNH stock despite the bargain.
The former hedge fund manager says that investors will want to wait until the Q2 earnings report on July 29 , th before deciding whether or not it is worth buying UnitedHealth in 2025’s second half.
UnitedHealth’s stock has not yet reached its bottom.
UnitedHealth’s shares took a major hit in the last few months. They have fallen more than 40 percent year to date following a rare miss on earnings and a downgrade of its full-year guidance.
Since the 2008 global financial crisis, this was the first time that the quarterly report of the insurer has been below Wall Street expectations.
Some investors still see some value in UNH’s stock, which is down by nearly half compared to its high point of $630 around late 2024.
Insiders have also been buying more shares, as Stephen Hemsley, the chief executive, purchased 86,000 at $288 per share – an investment of $25 million.
Jim Cramer still isn’t sure if the worst is over. He said on “Mad Money,” “I cannot pound the tables” in reference to the uncertainty around the earnings of the company on July 29 .
There’s going be a clearing-event, which I believe will happen. You may need to pay 50 points in the event that it is an excellent event. “But I won’t tell you to purchase more now,” he said.
UNH stock should only be purchased by patient investors
UnitedHealth’s July 29 th earnings could mark a pivotal moment for the NYSE listed firm.
Investors want to know more about the earnings trajectory of the company, the regulatory challenges it faces, and its Optum Division’s performance. All have been under scrutiny.
Cramer’s hesitation is a reflection of broader market uncertainty. UNH’s disappointing outlook has shaken confidence in the company, particularly given its reputation as a leader of operational excellence.
Mad Money’s host is no longer recommending restraints, despite being bullish about the stock. This underscores how high the stakes are. UnitedHealth is a strong healthcare company with a diverse business model. It also has a high cash flow.
In the short-term, however, it is possible that the update of July 29 the th could ignite a bullish trend or intensify the current selloff. Until then, it may be prudent to wait.
Wall Street’s recommendations for playing UnitedHealth
Wall Street is still at least slightly bullish about UNH’s shares, despite the risks mentioned above and an important event planned for July 29 .
The Wall Street Journal reports that the current consensus rating for the stock is “overweight”, with a mean price target of $364. This would indicate a potential gain of 13%.
The information in this post UnitedHealth Stock is cheap but wait until July 29 to buy it: Here’s Why may change as new developments unfold.
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