UnitedHealth Group Inc. (NYSE:UNH) beat third-quarter estimates on Tuesday and raised its informal full-year outlook for 2026. Management also told analysts their 2027 numbers look too conservative.

The insurer now expects 2026 adjusted earnings of at least $20.50 per share, up from its previous range of $19.50 to $20. Analysts had expected $19.86, per Benzinga Pro data. 

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Beat on Profit and Costs

Adjusted EPS rose about 61% to $4.69 from $2.92 a year earlier, and revenue came in at $112.69 billion against expectations of $111.40 billion.

The medical care ratio fell to 88.4% from 89.9% a year earlier, with UnitedHealth crediting plan design and new pricing for the improvement.

“Our third quarter performance reflects actions taken throughout 2026, driving meaningful progress and reinforcing our confidence to sustainably grow in 2027 and beyond within our 13 to 16% long-term target growth range,” CEO Stephen Hemsley said on the earnings call.

A Shot at 2027 Consensus

CFO Wayne DeVeydt went further. “We view our 2026 adjusted EPS guidance of at least $20.50 as a solid run rate on which to grow,” he said.

“We would offer that current analyst consensus for 2027 may understate the opportunity ahead and we see the lower end of our long-term 13% to 16% growth rate as a more reasonable starting point,” DeVeydt added.

Growth of 13% from $20.50 works out to roughly $23.17 per share, while consensus for 2027 sits at $22.62.

Costs Still Bite

Executives did not declare victory on medical costs. “Costs remain stubbornly high across the entire healthcare landscape, in particular in areas such as specialty pharmacy and acute healthcare service intensity,” UnitedHealthcare CEO Tim Noel said.

Noel singled out the No Surprises Act, a law meant to shield patients from unexpected bills. 

“Of particular concern is the ongoing abuse of the No Surprises Act dispute process by a relatively small number of clinician groups and third-party organizations,” he said.

Arbitration awards can run 10 to 11 times what Medicare would pay, he added.

Commercial cost trends are still running above 11%. Asked about margin recovery in the commercial business, Noel said high utilization “is going to stretch out our ability to achieve those long-term objective margins.”

Government programs looked better. The company now expects Medicare Advantage margins near the top of its 2% to 4% range. It called 2026 a trough year for core Medicaid margins, which should come in moderately better than minus 1%.

UnitedHealth shares rose 2% before the bell but reversed after the call opened. Management held back formal 2027 guidance until an investor meeting before year-end.

“So very positive. But we can’t really get to precision at this range,” Hemsley said.

UNH Stock Price Activity: UnitedHealth stock was up 0.58% at $380.71 at the time of publication Tuesday, according to Benzinga Pro.

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