Actions of UnitedHealth Group (NYSE:UNH) fell for the second straight session today, as investors appear to reckon with the backlash against the company following the killing of UnitedHealthcare CEO Brian Thompson on Wednesday morning.
UnitedHealth stock ended the day down 5.1% after losing 5.2% on Thursday. Other health insurance actions also fell, although the broader market gained on a strong jobs report.
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Today's selloff comes even as some analysts raised their price targets in response to the company's 2025 forecast, released after close of business Tuesday, ahead of an investor conference that was canceled after the killing of Thompson, who headed the company's insurance division.
On social media and in the comments sections of news articles, there has been significant outcry against the company's insurance practices, particularly its denial rate and its use of AI to deny coverage . A widely shared chart shows that UnitedHealth denies 32% of claims, more than any other insurer and double the industry average.
Dean Phillips, a congressman representing UnitedHealth's home district in Minnesota, acknowledged the insurance crisis in an article on X and concluded: “The real culprit is Congress and money in politics, and it's time to change. »
It is unclear what the ultimate fallout from the event will be, or whether anything will change for the health insurance industry. For the moment, however, the issue has captured the nation's attention and investors seemed surprised by the level of outrage directed at the company.
There could be ESG– related calls for institutional investors to divest from UnitedHealth and other health insurance stocks, or there could be changes at the regulatory level that would impact the earnings of UnitedHealth and its peers.
In its filing, UnitedHealth forecast adjusted earnings of $29.50 to $30 in 2025, up from $27.50 to $27.75 forecast for 2024, showing the company continues to expect regular growth in its results even if it is faced with an increase in costs due to the aging of the population.
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