Core Viewpoint - The S&P 500 index, despite its heavy weighting towards large companies, has shown strong performance over the years, with a 173% increase from 2015 to 2025, and a total return of 226% including dividends [2] Company Overview: UnitedHealth Group - UnitedHealth Group has faced significant challenges recently, particularly in its UnitedHealthcare business, leading to a decline in stock prices [5][11] - The company has a strong history of dividend growth, with a 320% increase over the past decade, currently offering a 2.8% dividend yield, which is more than double the average yield of S&P 500 dividend payers [6] Financial Performance and Outlook - The company added 2.1 million new Medicare Advantage patients in 2024, indicating growth potential in this segment [6] - Management's earnings guidance has been revised downward due to higher-than-expected medical expenditures, with initial projections for 2025 earnings per share revised from $28.15-$28.65 to $24.65-$25.15, and ultimately suspending the earnings outlook entirely [8][9] - The stock is currently trading at a low valuation of 12.4 times trailing-12-month earnings, suggesting potential for future growth as the company has historically increased earnings per share by 10.9% annually over the past decade [15] Competitive Position - UnitedHealth Group's Optum Health segment employs around 10% of America's physicians, providing it with significant control over medical expenses compared to competitors [13] - The company is expected to maintain a competitively priced option in the market due to its integrated business model, despite potential short-term earnings contractions related to Medicare Advantage planning [14]

Core Viewpoint - Buying quality dividend stocks near multiyear lows can be advantageous for long-term investors, especially if the dividend remains intact as the stock price declines [1] Group 1: PepsiCo - PepsiCo has seen a 25% decline in value over the past 12 months, with first-quarter sales down approximately 2% [4] - Despite challenges, PepsiCo generated over 1% organic growth in the first quarter, and the decline in sales was significantly impacted by foreign exchange [5] - The company produced $7.3 billion in free cash flow over the last 12 months, matching its dividend payments, indicating that the dividend payout is not in imminent danger [6] Group 2: UnitedHealth Group - UnitedHealth Group is trading near a four-year low due to rising costs affecting its bottom line [7] - The company experienced a 4% year-over-year increase in adjusted earnings per share in the first quarter, despite challenges in its Medicare Advantage business [8] - With a modest payout ratio of 35%, UnitedHealth is not at serious risk of cutting its dividend, and it trades at a P/E multiple of 17, below its five-year average of nearly 20 [9] Group 3: United Parcel Service (UPS) - UPS is trading near its 52-week low, with revenue for the first quarter totaling $21.5 billion, slightly down from $21.7 billion in the previous year [10][11] - The company plans to cut 20,000 jobs and reduce deliveries involving Amazon to improve margins amid economic challenges [11] - UPS's diluted earnings per share were $1.40, below its quarterly dividend of $1.64, but the company has a plan to improve profitability, making it a potential contrarian buy [12][13]