UnitedHealth Group said Thursday that its second-quarter net income rose 5.5 percent, trumping Wall Street expectations, as enrollment gains helped fuel revenue growth and consumers continued to moderate their use of health care services, The Associated Press reports.
UnitedHealth’s enrollment grew about 4 percent to 35.9 million compared to last year’s second quarter, led by gains in Medicare and Medicaid plans and commercial coverage, which includes employer-sponsored and individual plans. That contributed to an 8.3 percent jump in revenue to 27.3 billion.
The company raised its full-year earnings estimate to between $4.90 and $5.00 per share. That was up from a prior estimate of between $4.80 and $4.95. Analysts surveyed by FactSet expected earnings of $4.99 per share.
The insurer usually trumps analyst expectations for the quarter. Investors like UnitedHealth’s business diversity, which helps it handle changes in enrollment or other insurer pressures on profitability.
Its shares rose 58 cents to $56.93 in morning trading. Its shares are 6 percent below their 52-week high of $60.75 set in mid-June.
The Minnetonka, Minn., insurer said it earned $1.34 billion, or $1.27 per share, in the three months that ended June 30. That’s up from $1.27 billion, or $1.16 per share, in the same quarter last year.
Analysts forecast earnings of $1.18 per share on $27.34 billion in revenue.
UnitedHealth and other health insurers have been helped in recent quarters by health care use that has risen at rates that were slower than expected when they set premiums. Industry analysts and other experts have said use tends to rise at slower levels after a recession, as consumers cut back on spending.
