Flood of New Patients Pushes UnitedHealth Higher

Stocks are moving higher today after jobless claims dropped and companies reported somewhat mixed earnings. The number of people filing initial jobless claims dropped 24,000 to 334,000 last week, which is the lowest level since early May. This continues the generally positive employment news, although the labor market isn't improving as quickly as most people would like. Investors used the data point as a reason to bid the Dow Jones Industrial Average (DJINDICES: ^DJI  ) and the S&P 500 (SNPINDEX: ^GSPC  ) up 0.45% and 0.48%, respectively, late in trading. 

On the earnings front, UnitedHealth Group (NYSE: UNH  ) is up 6.4% after reporting a surprisingly strong second quarter. Revenue jumped 12% to $30.4 billion, while net income rose to $1.44 billion, or $1.40 per share. The big driver was an increase in patients covered, which should continue under Obamacare next year. The company covered 89.2 million people as of June 30, up from 76.6 million a year ago. 

Obamacare will undoubtedly have far-reaching effects for UnitedHealth Group, competing insurers, device makers, hospitals, and many others in the health care industry. The Motley Fool's new free report, "Everything You Need to Know About Obamacare," lets you know how your health insurance, your taxes, and your portfolio could be affected. Click here to read more.

The other big report came from Intel (NASDAQ: INTC  ) , which said revenue fell 5% to $12.8 billion in the second quarter and net income fell 29% from a year ago to $2 billion. That's a big drop-off, and it owes almost entirely to falling PC sales. Intel has to increase its presence in the mobile market or risk the continued deterioration of its business, because there's no bottom in sight for PCs right now.  

That's the bad news, but the upside is that we may be at the bottom of the trough for Intel. Revenue was up 2% from last quarter, and gross margin climbed to 58.3% from 56.2%. The company also recently signed up Galaxy's Tab 3 and has a new line of 14-nanometer chips coming out next year. If those chips catch on, the company will be back to growth in 2014. That said, there are lots of reasons to be cautious about Intel, considering the fall of the PC, and it needs to prove in coming quarters that it can gain share in future mobile devices.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2544690, ~/Articles/ArticleHandler.aspx, 9/29/2016 8:15:43 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,143.45 -195.79 -1.07%
S&P 500 2,151.13 -20.24 -0.93%
NASD 5,269.15 -49.39 -0.93%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/29/2016 4:35 PM
^DJI $18143.45 Down -195.79 -1.07%
^GSPC $2151.13 Down -20.24 -0.93%
S&P 500 INDEX CAPS Rating: No stars
INTC $37.32 Down -0.12 -0.32%
Intel CAPS Rating: ****
UNH $138.32 Down -2.09 -1.49%
UnitedHealth Group CAPS Rating: ****