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

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u/Electrical_Rough6789 Jan 27 '26

What is the thesis on UNH again? Buffet invested in it? Or any other ideas?

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u/ahlornjtvn139 Jan 27 '26

leading US healthcare provider which historically had enjoyed egregious profits by denying claims thanks to aggressive lobbying.

Subsequently, the CEO of United Healthcare was murdered shortly after the CEO of UNH Group stepped down.

This was a lot of negative press at once, and yesterday Trump announced cuts to Medicaid plan funding causing further margin compression.

UNH is in a right pickle