UnitedHealth hiked its 2015 forecast after soaring past Wall Street’s first-quarter expectations with a performance fueled in part by growth outside health insurance.
Shares of the nation’s largest health insurer climbed toward another all-time high hours before markets opened Thursday, after it said it now expects annual earnings of $6.15 to $6.30 per share, up from a forecast of $6 to $6.25 per share that it made late last year.
Analysts had been expecting $6.21 per share for the year, according to FactSet.
UnitedHealth also raised its revenue forecast as the Minneapolis company’s first quarter backed up optimistic vibes that company executives exuded in January, when they said the insurer was carrying momentum into 2015 from a strong finish last year.
In the first quarter, earnings climbed about 29 percent to $1.41 billion, or $1.46 per share. That’s up from $1.1 billion, or $1.10 per share, in last year’s quarter.
Revenue jumped 13 percent to nearly $36 billion.
Analysts expected, on average, earnings of $1.33 per share on $34.73 billion in revenue, according to Zacks Investment Research.
Health insurance is the company’s largest business, but it also operates a fast-growing Optum segment that offers pharmacy benefits management and data technology services, and it provides care through clinics and doctors’ offices.
Operating earnings from that Optum segment jumped 14 percent to $742 million.
Shares of UnitedHealth Group Inc., a component of the Dow Jones Industrial Average, climbed nearly 5 percent, or $5.58, to $122.90 in early morning trading. The stock gained 34 percent last year, and the price has more than doubled since the end of 2012, hitting and resetting several all-time-high marks along the way.
UnitedHealth is the first insurer to report earnings every quarter, and many analysts and investors see it as a bellwether for other insurers.