Goldman added the insurer to its U.S. Conviction List after an earnings beat, citing plans to cut Medicare Advantage enrollment by 1.3 million and Optum Health membership by about 10%.
The bank said updated pricing and easing healthcare costs should help Medicare Advantage revenue fall 4% this year while EBIT rises about 50%, aided partly by AI-driven savings.
Goldman expects annual earnings per share growth of more than 15% through 2028 as UnitedHealth recovers from last year's pressure from rising medical costs and reimbursement changes.
With regulators scrutinizing Medicare Advantage overpayments and AI adoption rising, is UnitedHealth's realignment a model for the industry—or a warning sign?
Can UnitedHealth's bold 'shrink to grow' strategy and heavy AI investment truly deliver the promised multi-year profit rebound—or are hidden risks lurking?