ANTM

UnitedHealth Group Raises Guidance After Stellar Earnings Report

by

Image Shown: We added UnitedHealth Group Inc to the Dividend Growth Newsletter portfolio back on November 27, 2020. Since then, shares of UNH have surged higher, though we are primarily interested in the company’s immense dividend growth potential. By Callum Turcan On April 15, health insurance and health care solutions provider UnitedHealth Group Inc (UNH) reported first quarter 2021 earnings that beat both consensus top- and bottom-line estimates. In conjunction with the earnings update, management raised the company’s full-year adjusted (non-GAAP) EPS forecast for 2021 up to $18.10 – $18.60 versus $17.75 – $18.25 previously. At the midpoint of guidance, the company’s new forecast represents ~9% growth over its 2020 adjusted EPS of $16.88. UnitedHealth Group maintained its expectations for … Read more

Cigna Is An Intriguing Health Care Idea

by

Image Source: Cigna Corporation –2021 Investor Day Presentation Executive Summary: Health care giant Cigna Corporation has a stellar cash flow profile, pristine balance sheet, promising growth outlook, and remains committed to rewarding shareholders. The company initiated a quarterly dividend at the start of 2021 and intends to continue buying back a sizable amount of its stock going forward. Management recently issued favorable guidance that indicates Cigna’s growth story is expected to continue this year as the world emerges from the COVID-19 pandemic. Cigna’s telehealth ambitions are quite intriguing as well. Recent updates at Cigna have placed the health care company on our radar. By Callum Turcan Cigna Corporation (CI) offers various health care products and services including health insurance plans, behavioral … Read more

ALERT: Raising Cash in the Newsletter Portfolios

by

January 27, 2021 ALERT: Raising Cash in the Newsletter Portfolios We are raising the cash position in the simulated Best Ideas Newsletter portfolio and simulated Dividend Growth Newsletter portfolio to 10%-20%. — By Brian Nelson, CFA — Our research has been absolutely fantastic for a long time, but 2020 may have been our best year yet. You can read the 2020 recap here. With the S&P 500 trading within our fair value estimate range of 3,530-3,920 (and the markets rolling over while showing signs of abnormal behavior), we’re raising the cash position in the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio to 10%-20%. — For more conservative investors, the high end of this range may even be larger, especially … Read more

UnitedHealth Group Is a Rock-Solid Dividend Growth Opportunity

by

Image Shown: Shares of UnitedHealth Group Inc, which we added to our Dividend Growth Newsletter portfolio back on November 27, continue to climb higher. The top end of our fair value estimate for UnitedHealth Group sits at $401 per share. By Callum Turcan On January 20, UnitedHealth Group (UNH) issued fourth quarter and full-year results for 2020 that beat both consensus top- and bottom-line estimates. The health care giant reported a 6% annual increase in its GAAP revenues in 2020, with its ‘Premiums,’ ‘Products’ and ‘Services’ sales all reporting meaningful increases. Its GAAP earnings from operations grew by 14% annually in 2020, though we caution there is some noise due to the deferral of certain medical procedures, a result of … Read more

Walgreens Begins to Recover

by

Image Shown: Shares of Walgreens Boots Alliance Inc are beginning to recover. By Callum Turcan Shares of Walgreens Boots Alliance Inc (WBA) are on the rise after the company recently posted a solid earnings report while also reaching a big divestment deal. As we recently covered, Walgreens is divesting most of its European-focused wholesale pharmaceutical distribution business to AmerisourceBergen (ABC) and that article can be viewed here. Please note Walgreens has a material strategic stake in AmerisourceBergen’s equity which will grow in terms of total shares once the divestment closes. Here is a brief excerpt from that article: On January 6, Walgreens Boots Alliance Inc announced it had reached a deal with AmerisourceBergen Corporation (ABC) to sell the “the majority of” … Read more

Walgreens Sells European-Focused Wholesale Pharmaceutical Distribution Business to AmerisourceBergen

by

Image Shown: Walgreens Boots Alliance Inc is undergoing a major transformation. Part of that strategy involves divesting its European wholesale pharmaceutical distribution business, Alliance Healthcare, to its strategic partner AmerisourceBergen Corporation. Image Source: Walgreens Boots Alliance Inc – Fourth Quarter and Full Year Fiscal 2020 IR Earnings Presentation By Callum Turcan On January 6, Walgreens Boots Alliance Inc (WBA) announced it had reached a deal with AmerisourceBergen Corporation (ABC) to sell the “the majority of” its European-focused wholesale pharmaceutical distribution business, Alliance Healthcare, for about $6.5 billion ($6.275 billion in cash along with 2 million shares of ABC). Please note that Walgreens already owns a sizable stake in AmerisourceBergen as the former owned ~28% of the latter’s outstanding shares as … Read more

UnitedHealth Group’s Dividend Growth Potential is Impressive

by

Image Shown: UnitedHealth Group Inc has a tremendous dividend growth runway, one that is supported by its high-quality cash flow profile, pristine balance sheet, and improving near-term outlook. Shares of UNH have staged an impressive recovery over the past several months since crashing in March 2020 due to headwinds arising from the ongoing COVID-19 pandemic. We added UnitedHealth Group to our Dividend Growth Newsletter portfolio on November 27, 2020. By Callum Turcan On November 27, we added UnitedHealth Group Inc (UNH) to the Dividend Growth Newsletter portfolio (link here). The company has an “EXCELLENT” Dividend Growth rating as the firm is well-positioned to push through meaningful dividend increases in the coming years. Additionally, UnitedHealth Group earns an “EXCELLENT” Dividend Safety … Read more

Growing Competitive Pressures, Leverage Drive Our Reduced Fair Value Estimate of CVS Health (Walgreens, Too)

by

By Callum Turcan On November 9, we reduced our fair value estimate of CVS Health Corporation (CVS) (which operates pharmacies, walk-in medical clinics, retail centers, and a large health insurance business). Our new fair value estimate is $55 per share, down from $73 per share previously. CVS Health’s 52-week share price range has been $52-$77, and the company yields 2.7% at the time of this writing. We recently wrote an article here explaining some of the major broad-based drivers behind why fair value estimates can, do, and should change over time as future expectations change. From our perspective, CVS Health’s near- and medium-term outlook has become increasingly stressed. Though investors have bid up shares of CVS in the wake of … Read more

UnitedHealth Remains on Our Radar for Dividend Growth Newsletter Portfolio

by

Image: On a price-only basis, from the beginning of 2008, UnitedHealth’s shares have advanced ~600%, while the S&P 500 has increased ~150%. The measurement period covers both the Obama and Trump administrations. By Brian Nelson, CFA UnitedHealth Group (UNH) is a name that we don’t dedicate a lot of resources to, as we tend to prefer diversified exposure to the healthcare arena in both the Best Ideas Newsletter portfolio and Dividend Growth Newsletter portfolio via the Healthcare Select Sector SPDR (XLV)–UnitedHealth Group is a ~8% weighting in the ETF at the time of this writing. Nonetheless, this Dow Jones Industrial Average (DIA) component has been under material accumulation of late based on its pricing action. Year-to-date, on a price-only basis, … Read more

3 Lessons in Portfolio Management Over 10 Years

by

Dear members: — We’re finally getting a pause in the rapid ascent of the markets on September 3rd. Though headlines may look scary and momentum/volatility investors could start to pile on to the downside, a modest retracement is actually a good thing. We continue to focus on the long haul with our processes, and we’re viewing the sell-off as profit taking, for the most part. — In the near term, the markets will also have to digest some speculators betting on mean reversion between “value” (cyclical) versus “growth” (secular), but we maintain the view that the value-versus-growth conversation is largely nonsense (see block quotes below), and mean reversion is something akin to the gamblers’ fallacy, in my humble opinion. Investors should also continue … Read more