Medical - Healthcare Plans · NYSE
Current Price
$370.74
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on UnitedHealth Group Incorporated with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
UnitedHealth Group Incorporated operates as a diversified health care company in the United States. It operates through four segments: UnitedHealthcare, Optum Health, Optum Insight, and Optum Rx. The UnitedHealthcare segment offers consumer-oriented health benefit plans and services for national employers, public sector employers, mid-sized employers, small businesses, and individuals; health care coverage and well-being services to individuals age 50 and older addressing their needs for preventive and acute health care services, as well as services dealing with chronic disease and other specialized issues for older individuals; Medicaid plans, children's health insurance and health care programs; health and dental benefits; and hospital and clinical services. The OptumHealth segment provides access to networks of care provider specialists, health management services, care delivery, consumer engagement, and financial services. This segment serves individuals directly through care delivery systems, employers, payers, and government entities. The OptumInsight segment offers software and information products, advisory consulting arrangements, and managed services outsourcing contracts to hospital systems, physicians, health plans, governments, life sciences companies, and other organizations. The OptumRx segment provides pharmacy care services and programs, including retail network contracting, home delivery, specialty and compounding pharmacy, and purchasing and clinical capabilities, as well as develops programs in the areas of step therapy, formulary management, drug adherence, and disease/drug therapy management. UnitedHealth Group Incorporated was incorporated in 1977 and is based in Minnetonka, Minnesota.
ROIC (TTM)
8.1%
ROE (TTM)
12.4%
FCF Yield
5.84%
Based on trailing twelve-month data, UNH shows a free cash flow per share of N/A and a ROIC of 8.1%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 5.84% are important context metrics when evaluating UNH's stock valuation relative to peers.
The intrinsic value of UNH depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether UNH is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $370.74. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on UnitedHealth Group Incorporated: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Medical - Healthcare Plans industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting UNH's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For UnitedHealth Group Incorporated, this means projecting how much free cash flow the Medical - Healthcare Plans will produce over the next 5-10 years, then discounting those amounts to today's dollars. UNH's ROIC of 8.1% shows moderate capital returns.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For UNH, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
