Jefferies has reduced its price target for UnitedHealth Group (NYSE:UNH) to $340.00 from $418.00, while maintaining a Buy rating on the shares. The updated target implies meaningful upside relative to UNH's most recent trading level of $282.70 and positions the stock below InvestingPro's calculated Fair Value, signaling potential undervaluation in the view of some market measures.
The sizable cut in price target follows what Jefferies called "a tough 24 hours" for the healthcare conglomerate, language that underscores recent market volatility and investor concerns. UnitedHealth's shares plunged 18.7% over the prior week, despite the company's historically low share-price volatility as reflected by a beta of 0.43.
Even with the lower target, Jefferies reiterated confidence in the company's leadership, saying management is "up to this tall task" of addressing the current set of challenges. The firm spelled out specific drivers that could help restore investor interest, noting that "100bp+ of Final Rate improvement would help" and advising that management should reaffirm its "price to margin" strategy irrespective of prevailing conditions.
On margins, Jefferies flagged questions about the pace of expansion, writing that it "expected more with a 9% core rate, despite $4B of V28." The firm also pointed to the potential for regulatory or methodological shifts to affect future requirements, noting that "chart review delinking" could possibly remove a "V29" requirement in plan year 2028.
UnitedHealth's recent quarterly results appear to have fed some of the downward pressure. The company reported fourth-quarter 2025 revenue of $113.2 billion, slightly under the consensus forecast of $113.73 billion, while earnings per share came in at $2.11, matching expectations. The modest revenue shortfall and a cautious outlook for 2026 have been focal points for investors.
Other firms have adjusted their targets as well. RBC Capital reduced its price target to $361 from $408 and maintained an Outperform rating. RBC's revision was tied to uncertainty around an advance rate notice, which RBC analyst Ben Hendrix characterized as "weaker-than-expected." Piper Sandler also pared its target to $396 from $417, citing "persistent funding headwinds" in Medicare Advantage; the firm kept an Overweight rating and expressed confidence in UnitedHealth's capacity to defend margins.
Collectively, these analyst moves reflect recalibration in the market's assessment of UnitedHealth's near-term growth and margin trajectory. The combination of a recent earnings revenue miss, targeted analyst commentary on rate and margin dynamics, and multiple price target adjustments has contributed to a more cautious investor tone toward the stock and heightened scrutiny of Medicare Advantage funding and execution on margin strategy.
Context and next steps
Analysts and investors will be watching for any management commentary that reiterates or refines the company's "price to margin" approach and for evidence of the Final Rate improvements Jefferies cited as a potential market re-engagement catalyst. How regulators or plan-year methodologies evolve - including the prospect that "chart review delinking" could remove a V29 requirement in plan year 2028 - will also be material to forecasts and valuations.