Analyst action
Bernstein SocGen Group has reduced its price target on UnitedHealth Group (NYSE:UNH) to $405.00 from $444.00, while retaining an Outperform rating on the shares. The revised target remains substantially higher than UNH's most recent trade at $282.70, implying material upside from current levels.
Forecast changes and valuation context
The firm trimmed its earnings-per-share assumptions modestly across the mid-term: 2026 EPS estimates were lowered by 1%, 2027 by 4%, and 2028 through 2030 by 2-3%. Bernstein SocGen attributed the 9% reduction in its price target mainly to a slower expected recovery in the price-to-earnings multiple driven by investor concern over the long-term funding outlook for Medicare Advantage.
UnitedHealth currently trades at a trailing price-to-earnings ratio of 18.3, based on diluted last-twelve-month EPS of $19.22. InvestingPro data cited by the firm indicates the company appears undervalued on a Fair Value basis and shows a favorable PEG ratio of 0.58, suggesting the stock's P/E is low relative to near-term earnings growth expectations.
Quarterly results and revenue profile
Bernstein SocGen characterized UnitedHealth's fourth-quarter performance as an inline operating quarter, noting continued portfolio cleanup and guidance for adjusted EPS in 2026 that sits in line with expectations. The firm expressed a preference for lower 2026 revenues, viewing them as evidence of pricing discipline across Medicare Advantage, Marketplace, and OptumHealth businesses.
On a scale basis, UnitedHealth reported roughly $435.16 billion in revenue over the last twelve months, reflecting the company's size in the Healthcare Providers & Services industry.
Margins, OptumHealth and managed care
Analysts at Bernstein SocGen see scope for faster improvement in UnitedHealth Care's medical loss ratio (MLR) in 2026. They noted that OptumHealth base earnings were below the firm's prior expectations, but they still anticipate solid margin percentage progress by 2027. The maintained Outperform view rests on the expectation that UnitedHealth can continue to expand margins at both its managed care organization and OptumHealth through disciplined pricing, even though lower Medicare Advantage rates may extend the timeline for full margin recovery.
Market reactions and peer target moves
UnitedHealth's fourth-quarter 2025 top-line came in slightly below consensus at $113.2 billion versus a forecast of $113.73 billion. Reported EPS for the quarter was $2.11, in line with estimates.
Following the earnings release, several other brokerages adjusted their targets. UBS cut its target to $410, citing uncertainty related to Medicare Advantage rates. Jefferies reduced its target to $340. RBC Capital set a target of $361 while noting a weaker-than-expected advance rate notice but keeping a positive long-term stance. Piper Sandler lowered its target to $396, pointing to persistent funding headwinds in Medicare Advantage but expressing confidence in UnitedHealth's margin management capabilities.
Bottom line
Bernstein SocGen's move narrows the gap between its prior target and current sentiment, but it stops short of changing the firm's positive rating. The adjustment reflects a mix of slightly reduced EPS expectations, a more cautious view on P/E recovery tied to Medicare Advantage funding concerns, and a continued belief in UnitedHealth's ability to regain margin momentum over time.
Key summary
- Bernstein SocGen lowers UNH price target to $405 from $444 and keeps an Outperform rating.
- Modest EPS cuts: 2026 -1%, 2027 -4%, 2028-2030 -2% to -3%.
- Company trades at LTM P/E of 18.3 with diluted EPS of $19.22 and LTM revenue of $435.16 billion.