"The finalized Medicare Advantage rates for 2027 delivered a net increase of 2.48%, exceeding the expected range of 1% to 2%, impacting 35 million enrollees."
"BofA raised price targets across several managed care names, citing higher multiples after CMS finalized Medicare Advantage rates, providing visibility on 2027 rates."
"UnitedHealth Group's full-year 2025 revenue was $447.57 billion, an 11.81% increase year over year, although operating income fell by 41.26%."
"The company is planning to exit 2.3 to 2.8 million members from unprofitable contracts in 2026, indicating a deliberate strategy to shrink its membership base."
Bank of America increased UnitedHealth Group's price target to $337 from $315 due to a favorable Medicare Advantage policy update. The Centers for Medicare & Medicaid Services finalized a 2.48% rate increase for 2027, exceeding expectations and impacting 35 million enrollees. This clarity allows insurers to price products more profitably. Other managed care companies also saw target increases. UnitedHealth reported $447.57 billion in revenue for 2025, but operating income fell significantly as it plans to reduce its membership base by exiting unprofitable contracts in 2026.
Read at 24/7 Wall St.
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