UNH is trading at its lowest levels since 2020
UnitedHealth Group Inc (NYSE:UNH) stock is dragging the Dow and its sector today, after the health insurer suspended its 2025 guidance amid steeper-than-anticipated expenditure issues. CEO Andrew Witty is also stepping down, citing personal reasons. At last check, UNH was down 12.8% to trade at $330.25, and earlier fell to an five-year low of $322.90.
Sector peers Cigna (CI), CVS Health (CVS), and Humana (HUM) are all deep in the red in response to today's news. This is poised to be the stock's sixth-straight loss, a skid that has UNH's 14-Day Relative Strength Index (RSI) deep in "oversold" territory at 14.
The shares have racked up a 36% deficit in 2025, yet not a single analyst has stepped forward with a bear note or downgrade. They're certainly overdue, considering of the 24 in coverage, 22 maintain a "buy" or better rating, with not a single "sell" in sight. The equity's consensus 12-month price target of $549.91 is now a 70% premium to its current perch, implying bear notes could add pressure going forward.
Its similar in the options pits, where traders are showing strong preference for long calls. During the past 10 days at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), UNH sports a 10-day call/put volume ratio of 2.90 that sits two percentage points from an annual high.
Today, over 120,000 calls and 70,000 puts have changed hands, total options volume that's eight times the average intraday amount. The May 300 put is the most popular, while the May 360 call -- with sell-to-open activity detected -- is also seeing notable activity today.
Now looks like an great time to weigh in with options. The equity's Schaeffer's Volatility Scorecard (SVS) sits at a 90 out of 100, indicating UNH has a history of exceeding option trader's volatility expectations during the past year.