The massive banks will get the headlines, however traders ought to watch UnitedHealth Group Inc. NYSE: UNH. The medical insurance large scored a double beat when it reported fourth-quarter earnings on January 12, 2024. The headline numbers are as follows: Earnings per share got here in at $6.16, beating analysts’ expectations of $5.99. Income of $94.43 beat expectations of $92.18. 

Nonetheless, UNH inventory dropped 3.4% in early buying and selling as traders have been involved concerning the firm’s sharp year-over-year rise in medical bills. A lot of this stems from the corporate’s Medicare Benefit enterprise. An increase in medical bills is a drag on earnings. That is the explanation why UNH inventory fell after earnings.  

With that stated, there are technical the reason why UNH inventory could also be buyable on this current dip. However there’s one more reason it’s possible you’ll wish to take into account. 

The rise of AI in healthcare 

One of many highlights of the earnings report got here from the corporate’s Optum division. Quarterly income was $59.5 billion, a 24.2% enhance. That helped to offset among the rise in medical bills. 

Optum is comprised of a gaggle of medical doctors who present care by native medical teams and contract with most main medical insurance plans. This consists of pharmacy companies in addition to telehealth. Nonetheless, a key focus of Optum is the usage of expertise and data-enabled care supply.  

If that seems like synthetic intelligence (AI), you are proper. Optum has its personal division, Optum360™, which has been utilizing AI since 2018. The thought is to maneuver from preventative medication to predictive medication. Using AI in care supply, nevertheless, continues to be in its early phases. 

Nonetheless, the corporate makes use of pure language processing (NLP) to enhance income accuracy and effectivity by serving to with duties reminiscent of discovering that means in medical information, revealing necessary documentation points to clinicians, and decreasing useful resource constraints. 

A protected, rising dividend 

The UNH inventory worth has jumped over 108% prior to now 5 years. That is roughly a mean annual acquire of 20%, making UnitedHealth Group one of many prime medical shares. It additionally qualifies UnitedHealth as a development inventory. Nonetheless, traders should not overlook the corporate’s dividend. 

The yield of 1.44% is not significantly spectacular. However, the corporate has elevated its dividend in every of the final 14 years. Within the final three years, that dividend has grown by over 14% yearly. And with a 32% payout ratio, future dividend development is a close to certainty. At the moment, the full annual payout per share is $7.52 

UNH inventory approaches the purchase zone 

UNH inventory is buying and selling inside a reasonably outlined vary. Twice within the final 45 days, the inventory has confronted resistance at its 52-week excessive of round $550. Nonetheless, earlier than earnings, the inventory was buying and selling round $520. This has been a shopping for sign for traders on two separate events within the final three months. 

After all, previous efficiency is not all the time a helpful predictor. However technical evaluation means that with the UNH inventory drifting in direction of its 100-day easy transferring common at $521.60, the inventory may very well be a purchase.  

MarketBeat retains observe of Wall Avenue’s top-rated and finest performing analysis analysts and the shares they suggest to their purchasers every day. MarketBeat has recognized the that prime analysts are quietly whispering to their purchasers to purchase now earlier than the broader market catches on… and UnitedHealth Group wasn’t on the listing.

Whereas UnitedHealth Group at the moment has a “Average Purchase” score amongst analysts, top-rated analysts imagine these 5 shares are higher buys.

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