Shares of UnitedHealth Group (UNH -7.44%) are falling on Tuesday, down 5.4% as of 2:20 p.m. ET. The drop comes as the S&P 500 (^GSPC -0.30%) declined 0.3% and the Nasdaq Composite (^IXIC -0.38%) fell 0.2%.
The troubled health insurance giant set worse-than-expected guidance on Tuesday.
UnitedHealth continues to struggle
The company reported its Q2 financials today, revealing the insurer is still very much struggling. The company was able to deliver on revenue, reporting $111.62 billion versus the expected $111.52 billion, but it missed significantly on earnings per share (EPS), reporting $4.08 per share when Wall Street expected $4.48 per share.
More concerning was the company's outlook for the full year. UnitedHealth expects EPS of at least $16 and sales of $445.5 billion to $448 billion. Wall Street's expectations were EPS of at $20.9 and sales of $449.2.
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The company cited rising medical costs and abandoned "previously planned portfolio actions" as reasons for the disappointing outlook.
UnitedHealth's problems mount
This latest disappointing quarter is the latest in a series of bad news related to the massive insurer: The company's CEO abruptly stepped down, citing "personal reasons"; it was revealed that the DOJ currently has two investigations into the company's Medicare billing practices; and an exposé published by the Guardian alleges the company was paying nursing homes to keep residents out of the hospital when they needed elevated levels of care.
There are just too many issues facing UnitedHealth at the moment, with no clear picture of an imminent turnaround. I would stay away from the stock.
