UNH Shows Attractive Long-Term Return Potential Despite Paused Buybacks

3 months ago

"So, I see at least a 14 15% annual return on United Healthcare from this price. And plus, I'm also seeing a return from the dividend. The dividend right now is around 2.3% or 2 and a half% and it's well covered because the free cash flow yield is about 5 a.5%. So the coverage ratio or the free cash flow payout ratio is about 50%. So I'm seeing around two two and a half% from the dividend 13 14% from earnings per share. So I would say at least 15 16 17% annual return from a recessionp proof company. And there's a lot of bad sentiment. There's a lot of low expectations. So I see a lot of call option like payoff from this one because again expectations are low and the CEO will likely keep raising expectations more and more every quarter and they have a lot of pricing power in terms of raising prices on those plans because again there's really no alternatives to this one."

The speaker highlights United Health's earnings report and future outlook, emphasizing a forecast of 14-17% annual return based on dividend yield and earnings growth. Although buybacks are paused to improve their debt to capital ratio, the commentary is bullish on the company's underlying fundamentals and pricing power, making UNH a compelling long-term investment.

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