American Healthcare Makes a Killing
UnitedHealth Group released its quarterly earnings figures yesterday and beat on both the top and bottom lines. UnitedHealth is an American health insurer. It’s the second number you call after 9/11 (to pay).
If you’re investing in stocks like UnitedHealth, Anthem, Cigna, and Humana, keep an eye on the medical loss ratio. It’s a metric that reveals the difference between insurance premiums brought in, and medical claims paid out.
It was 80% last year for UnitedHealth, this meaning the firm shared a 20% profit margin with investors. It just reported a 70% medical loss ratio, thanks to coronavirus hospitalizations.
It’s evident that for-profit healthcare is making record profits, and some Americans take that as an insult. Joe Biden has not made a commitment to Medicare-for-All, and he won’t now that for-profit healthcare garners more political and economic heft. The two sides of this debate are both baring their teeth. It’s gonna come to a boil, and stocks are gonna whiplash.
These stocks could make useful shorts if uncertainty discounts and sin stock discounts are applied. UnitedHealth brought its stock price back down to Earth today, predicting it would have to pay some delayed bills for patients’ delayed coronavirus treatments this quarter.
If you’re buying UnitedHealth now, it’s a play on a second outbreak and an expensive vaccine!
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.