UnitedHealth Group Inc (NYSE:UNH) reported growth in second quarter profit, and raised its full-year earnings forecast today, but its shares fell after the Republicans scrapped a bill to overhaul President Obama's Affordable Care Act (ACA).
The Minnesota-based company recorded a second quarter profit of US$2.28bn, or US$2.46 a share, up from US$1.75bn, or US$1.81 per share a year earlier, and above forecasts for US$2.23 a share. Excluding certain items, UnitedHealth earned US$2.32 a share, compared with US$1.96 a year ago.
UnitedHealth also raised its full-year adjusted earnings-per-share guidance to between $9.75 and $9.90, up from between $9.65 and $9.85 previously.
The group saw its second quarter revenue rise by 7.7% to US$50.05bn, beating expectations for US$50.06bn, with revenue from its Medicare business rising by 17% to US$16.7bn.
The Optum unit, UnitedHealth's health-benefits platform, saw earnings grow 21% to US$1.5bn. OptumRx, the company's pharmacy benefit manager, saw revenue growth of 5.1% to US$15.8bn.
The insurer's medical-loss ratio - the percentage of premiums paid in claims - rose by 20 basis points year-over-year to 82.2%.as a health-insurance tax deferral was offset by an improved business mix, product performance and favorable reserve development.
But in early New York trading, UnitedHealth's shares shed 0.8% at US$185 after the collapse of the Republican party's push to repeal and replace Obamacare in the US Senate set up a possible repeal-only vote and clouded the path forward for President Donald Trump's other domestic policy goals.