UnitedHealth Shares Drop Amidmedicare Fraud Probe, CEO Exit, Guidance Suspension

UnitedHealth Group's stock has faced significant declines due to leadership changes, withdrawal of 2025 guidance, and allegations of Medicare fraud reported by the Wall Street Journal. RBC Capital lowered its price target on UnitedHealth to $355 from $525 but maintained an Outperform rating, viewing the recent selloff as an overreaction given the company's fundamentals and potential for a 3% Medicare Advantage margin next year. Despite the Department of Justice's ongoing investigation into the company's Medicare Advantage billing practices, Wolfe Research analysts upheld a $501 price target and an Outperform rating, citing that UnitedHealth's risk scores are only slightly above industry averages and expecting the gap to narrow. UnitedHealth has stated it has not been notified by the DOJ about any investigation and considers government reviews routine, while the stock trades near a 52-week low after a 47% decline over six months. Market consensus among analysts remains positive with an average price target of $457 and an overall Outperform recommendation, suggesting that the stock may be undervalued given its long-term prospects. The company's challenges include managing accelerating costs and headline risks while navigating regulatory scrutiny.