UnitedHealth's Dividend Yield Has Never Been This High. Should You Buy the Stock?

Core Viewpoint - UnitedHealth Group's stock has significantly declined this year, leading to an increase in its dividend yield, which may present an opportunity for dividend investors [1][2][4]. Group 1: Stock Performance and Yield - UnitedHealth's stock yield has risen to approximately 3.5%, nearly three times the S&P 500 average of 1.2%, which is atypical for the company [2]. - Historically, UnitedHealth's yield has been below 2%, making the current yield more attractive for potential investors [2]. - The stock has lost about 50% of its value this year due to concerns over growth prospects amid healthcare reform and rising costs [4]. Group 2: Financial Performance - In the most recent quarter ending June 30, UnitedHealth's sales increased by 13% year over year to $111.6 billion, slightly exceeding analyst expectations of $111.5 billion [6]. - However, adjusted earnings per share were reported at $4.08, falling short of Wall Street's projections of $4.48 [6]. Group 3: Management Changes and Market Sentiment - The company underwent a CEO change this year, with Andrew Witty resigning and Stephen Hemsley returning as CEO, which may influence investor sentiment positively or negatively [7]. - UnitedHealth's stock is currently trading at a steep discount, with a price-to-earnings ratio of less than 11, compared to the S&P 500 average of around 25 [8]. - Despite the challenges, the market may have overreacted to negative press, suggesting that the stock could be a good buy for long-term investors willing to be patient [10].