Plenty of Reasons to Target UnitedHealth Group Stock in May

UNH is the only Dow member on a list of the best S&P 500 stocks to own in May

Deputy Editor
May 4, 2022 at 12:51 PM
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With the help of Schaeffer's Senior Quantitative Analyst Rocky White, we've compiled a list of the 25 best S&P 500 stocks to own in May, going back 10 years. UnitedHealth Group Inc (NYSE:UNH), the only Dow member or healthcare stock on the list, landed at the seventh spot. Looking back over the last decade, UnitedHealth Group stock boasts an average May return of 3.3%, with nine out of 10 returns positive.

Breaking down UNH even further, the stock was last seen trading at $495.47 today. The shares are less than a month removed from an all-time high of $553.29, which came a couple weeks after the company announced its acquisition of LHC Group (LHCG). Meanwhile, UnitedHealth Group stock sits just 1.4% below its 2022 breakeven level.

What's more, UNH just pulled back to the historically bullish 80-day moving average. A separate study from White shows that over the last three years, the equity has pulled back to this key trendline seven times, and averaged a 3.5% jump one month later in 83% of these occasions. A comparable move from its current perch would put the stock at more than $512 per share. In combination with its historically bullish returns for the month of May, UnitedHealth Group stock should have no problem moving back towards its aforementioned peak.

UNH Chart May 4

Adding to this, UNH's Relative Strength Index (RSI) of 31 sits on the cusp of "oversold" territory. This typically means the stock could be due for a short-term bounce. 

 

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