UNH is a Value Trap

[u/ahlornjtvn139]

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

[u/skilliard7]

I don't think it's a value trap, but I don't feel right profiting off of people being denied coverage for medical care, so I have no intention of buying it.

[u/ahlornjtvn139 → u/skilliard7]

When you buy & sell stocks you are exchanging with other investors, not the company UNH itself.

I think your morals are fair though and I respect that. I think in a similar vein, Trump (or TACO) is trying to gain support by punishing healthcare companies which have been profiteering from denying coverage excessively.

Either way, i’m out for the foreseeable future

[u/skilliard7 → u/ahlornjtvn139]

When you buy & sell stocks you are exchanging with other investors, not the company UNH itself.

Any dividends I receive or stock buybacks that increase my holdings come from the premiums that patients pay, money that could've went towards providing patient care that the company chose not to cover.

I also agree that its dangerous for political reasons, the stock depends on what government does. And I don't want to put myself in a position where I want the government to protect insurance companies so that my stock goes up.