UnitedHealth Outperforms Analyst Expectations in Q1 Earnings — Company Builds Off of Pandemic Response

By Thomas Price Thursday, April 15, 2021

Following a year of intense focus on healthcare and the many companies and hospitals providing coverage and care to consumers, the COVID-19 pandemic looks to be slowly dissipating in the United States (US). Healthcare company UnitedHealth recently released its Q1 earnings report, with the business benefiting significantly from a strong response to the pandemic. The company beat out analyst expectations, posting better than projected revenues and earnings per share despite lofty expectations. These results have pushed company stock prices up in early pre-market trading.

UnitedHealthcare headquarters in Minnesota.

UnitedHealth Q1 Earnings vs. Expectations

In its Q1 earnings report, UnitedHealth posted a quarterly revenue of $70.2 billion. This figure is $5.8 billion more than the same quarter last year, which translates to around 9% growth year-over-year (YOY). The company also beat out analyst expectations by a solid margin, as most experts projected $69 billion in total revenue. With strong business growth for both UnitedHealthcare and Optum, the company also performed incredibly well on earnings per share.

In fact, the healthcare business reported earnings of $5.08 per share alongside adjusted earnings of $5.31 per share. UnitedHealth Group once again outperformed analyst expectations which had pegged the business to only generate earnings of $4.41 per share.

Business growth for UnitedHealth Group was seen across the board. However, strong areas for the UnitedHealthcare portion of the company were in individual Medicare Advantage membership, group membership, and Dual Special Needs Plans, which all saw boosts in total memberships over Q1 of the fiscal year.

For Optum Care, the major highlights came from the expansion of local care delivery networks. Alongside this expansion was the stronger online and digital capabilities as well as OptumRX membership growth. Optum Care also saw revenue per customer served surge greatly. In fact, compared to the same quarter the year before, revenue per customer serve jumped by 31%.

Future Outlooks and Stock Market Response

Due to the strength of business in Q1, UnitedHealth upgraded its full-year net earnings projections to a range of $17.15 to $17.65 per share. Adjusted earnings per share were also upgraded to a range of $18.10 to $18.60 per share. Expectations for the company could possibly reach even further given the current growth trajectory. However, UnitedHealth also released a net unfavorable impact of $1.80 per share if the COVID-19 pandemic takes a major turn for the worse. Even under the worst possible foreseeable future, the business should still see solid earnings over the course of the 2021 fiscal year.

The healthcare business has also begun reaping the benefits of its Q1 earnings report at the stock market. In early pre-market trading, UnitedHealth stock is up almost 2%. Stock prices now sit comfortably above $380 per share, pushing the business to near all-time highs.

In a statement released alongside the Q1 earnings report, CEO of UnitedHealth Group, Andrew Witty, said, “The unique combined capabilities of Optum and UnitedHealthcare and the unwavering commitment of our people continue to help advance the way care is delivered, improving results for those we serve and shareholders.”

About the Author

Headshot for author Thomas Price

Tom Price is a writer focusing on Entertainment and Sports Features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.

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