The S&P 500 (^GSPC -1.13%) index, the most widely followed index in the stock market, briefly entered bear market territory in April but rebounded in May, much to investors' relief. Yet, although the index gained 6.2% in May, nearly 30% of its constituent 500 stocks fell last month, with two healthcare stocks emerging as the worst-performing S&P 500 stocks in May.
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1. UnitedHealth Group
UnitedHealth Group (UNH -1.61%) was the worst-performing stock in the S&P 500 last month. It plunged 26.6% to 52-week lows of $248.88 per share on May 15 after CEO Andrew Witty abruptly resigned and UnitedHealth withdrew its earnings outlook for the full year as Medicare Advantage costs surged.
UnitedHealth also found itself in the middle of controversy in May when The Guardian alleged that the company secretly paid bonuses to nursing homes to prevent hospital transfers and cut costs. The Wall Street Journal, meanwhile, alleged that the health insurance giant was facing a criminal investigation by the Department of Justice for a "possible Medicare fraud."
UnitedHealth, however, has refuted the allegations made by both publications, appointed former CEO Stephen J. Hemsley with immediate effect, and expects to return to growth in 2026. UnitedHealth's second-quarter earnings on July 29 could determine where the stock is headed next.
2. Regeneron Pharmaceuticals
Shares of Regeneron Pharmaceuticals (REGN 1.33%) dived 18.2% in May, losing all that value on May 30 alone after Regeneron's second phase 3 trial for its experimental drug for chronic obstructive pulmonary disease, itepekimab, failed.
The drug is being co-developed by Regeneron and Sanofi, and its sales could hit nearly $5 billion at peak. Regeneron stock cracked as investors now believe the drug could be delayed by some years.
Regeneron, however, has a robust pipeline, and it initiated a quarterly dividend earlier this year. There's one update you'd want to know, though. Regeneron has been outbid by the co-founder and former CEO of 23andMe, a human genetics and biotech company it bid for in May.
