UnitedHealth Group beats Q4 earnings estimates; revenues match expectations

UnitedHealth Group (NYSE: UNH) reported better-than-expected earnings for the fourth quarter of 2019 while revenues matched estimates. Shares were down 0.40% in premarket hours on Wednesday.

Total revenues of $61 billion was up 5% from the same period last year and in line with forecasts.  

Net earnings attributable to UnitedHealth Group common shareholders was $3.5 billion, or $3.58 per share, compared to $3 billion, or $3.10 per share, last year. Adjusted EPS grew 19% to $3.90, beating estimates of $3.28.  

Favorable medical reserve development was $270 million in the quarter, with $150 million related to 2019 and $120 million related to previous years. Year-end days claims payable were 50.8 days compared to 49.5 in the fourth quarter of 2018. Medical costs increased 8% in the period.

Also read: BlackRock Q4 2019 Earnings Snapshot

During the quarter, revenues in the UnitedHealthcare segment increased 4% to $48.2 billion versus the prior-year period. Revenues in the Optum segment increased 7% year-over-year to $29.8 billion.

Revenues from premiums increased 6%. Revenues from products decreased slightly during the quarter while services revenues increased. Revenues from investment and other income rose 26%.

For the full year of 2020, GAAP EPS is expected to be $15.45 to $15.75 and adjusted EPS is expected to be $16.25 to $16.55.

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