To this point, 2025 has been something however easy for UnitedHealth Group.
The healthcare large introduced Tuesday that Andrew Witty will step down as CEO resulting from “private causes.” He’s being changed by Stephen J. Hemsley, who served as the corporate’s CEO from 2006 to 2017. Hemsley will stay as UHG’s chairman of the Board of Administrators, and Witty can be senior advisor to Hemsley.
“Main the folks of UnitedHealth Group has been an amazing honor as they work every single day to enhance the well being system, and they’re going to proceed to encourage me,” Witty stated in an announcement.
The corporate additionally introduced that it has suspended its 2025 outlook “as care exercise continued to speed up whereas additionally broadening to extra sorts of profit choices than seen within the first quarter, and the medical prices of many Medicare Benefit beneficiaries new to UnitedHealthcare remained greater than anticipated.” UHG stated it anticipates to return to development in 2026.
UnitedHealth Group declined MedCity Information’ request to remark additional.
Following the announcement, the corporate’s inventory dropped by almost 18%. This comes simply weeks after the corporate lowered its annual forecast resulting from a disappointing first-quarter efficiency, and solely months after UnitedHealthcare CEO Brian Thompson was shot and killed in December.
How is social media reacting to the CEO’s departure and the inventory drop? It may be boiled down to a few buckets:
Is it actually for private causes?
Some persons are questioning what leaving for “private causes” actually means.
“Whereas ‘private causes’ is the rationale supplied for Andrew Witty’s departure, the suspension of steering would counsel his departure is extra to do with the private causes of the board relatively than the boss,” stated Dylan Jones, managing companion of Boldsquare, a enterprise administration advisor, on LinkedIn.
Jones added that those that had been a part of the “Witty-era management bench” might now be questioning their very own future on the firm.
Jones isn’t alone in suspecting that Witty was seemingly pushed out relatively than stepping down voluntarily.
“Right here’s how you can get fired from the biggest healthcare firm on the planet:
9% inventory worth because you assumed the function
47% inventory worth in a single month,” stated Preston Alexander, writer of the The Healthcare Breakdown, a healthcare publication, on LinkedIn.
A shopping for alternative
UnitedHealth Group is undoubtedly dealing with challenges within the short-term resulting from its main cyberattack, missed earnings and regulatory scrutiny. Nevertheless, one particular person on X believes these points are non permanent and views this as a shopping for alternative.
“Primarily based on each mannequin and datapoint I’ve reviewed — nothing suggests this can be a completely damaged enterprise. … I could also be early. The inventory might fall additional within the brief time period. However I’m not making an attempt to time the underside. I’m making an attempt to purchase high quality companies after they’re hated and undervalued. This appears like a type of instances. I’m shopping for shares immediately,” stated @dividendology, who has a substack on investing.
One other investor known as UnitedHealth among the finest healthcare shares.
“All its short-term incidents up to now will quickly get pale,” stated @GoodwillTrader on X. “A brilliant inventory will at all times get better. I’ve 100% confidence on this funding long-term. 39% under-valued and touching month-to-month assist with time-cycled.”
Is that this deserved?
Whereas some are viewing this as a shopping for alternative, others are arguing that UnitedHealth Group is deserving of its struggles.
“I hope UnitedHealth continues to go underneath. Terrible firm. Their denial charge is 2x that of the trade common. Complete rip-off of an organization,” argued TeeDee144 on Reddit.
TeeDee144 isn’t the one one to suppose this.
“My firm makes use of UHC and they’re absolutely the worst medical insurance I’ve ever handled,” stated lion27 on Reddit. “Until you’re making a cost, all the things is as troublesome as doable and so they deny EVERYTHING. I switched to a household plan with Aetna by my spouse’s firm when our first child was born and so they have been great. Unsure if they simply look nice in comparison with UHC, however for the primary time I don’t violently hate my insurance coverage firm.”
Picture: filo, Getty Photos
