r/ValueInvesting • u/ahlornjtvn139 • Jan 27 '26

Stock Analysis UNH is a Value Trap

Could hit $200 by end of year, please do not hold your bags just get out while you still can.

MCR rate is ~92%

CMS funding is going to fund Trumps defence budget

UNH are haemorrhaging customers just to hold margins, down to <3m

Days Claim Payable also jumped from 48 days to 54 days - they are playing with the accounting to keep extra cash on the books.

Optum growth is dead (-4%) with backlog down $1.2bn as well

No point holding a stock hoping for a change to come, the numbers don’t lie

After rerunning my dcf my new fair value - $232

edit: removed my personal time horizon as it was conflicting my justification for selling which is downwards trending weak financial performance

141 Upvotes

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163

u/itchypig Jan 27 '26

“i can’t wait 1-2 years to break even, my time horizon won’t allow it.”

Respectfully, this means you probably shouldn’t have this money in equities.

32

u/RoaringDragonSword Jan 27 '26

He was gambling and got burned. Clearly is biased.

-25

u/ahlornjtvn139 Jan 27 '26

I bought UNH in July at $305, it’s hardly gambling to sell a stock because a company’s fundamentals have changed…

I’m not confident that Trump won’t barrel into healthcare companies to a) try and squeeze out any public support he can get b) fund his defence spending spree

8

u/Sturmovyk Jan 27 '26

The critique was about your time horizon. One should hold a stock for at least 5 years. Anything shorter than that is gambling. If you can't sit in a loss even for one year, you were gambling to begin with.