Funny how the herds that graze on Wall Street will behave. Health benefits company UnitedHealth (NYSE:UNH), along with competitors including WellPoint (NYSE:WLP), Aetna (NYSE:AET), Coventry (NYSE:CVH), and CIGNA (NYSE:CI), got smacked around earlier this year over fears of management abuse of options and a potential price war in the industry.

Strangely, neither of those concerns was new at the time; some folks had been talking about them for a while. Nor are they likely to prove truly consequential -- evidence of a price war is circumstantial at best, and while the options issue smells bad, it may prove widespread enough that no one company really gets hurt by it.

In the meantime, UnitedHealth just keeps on keeping on. Revenue was up 57% this quarter (boosted by a major acquisition), while various earnings measurements rose between 21% and 31%. Cash flow also remains strong; timing-adjusted operating cash flow was up 24% this quarter.

Quite frankly, I saw little new or surprising in this report. Enrollment continues to climb, though the sequential pace slowed a bit. Costs also seem to still be under control; the medical loss ratio did tick up this time around, but Medicare Part D and the acquisition are the bigger factors there. What's more, reserve developments continue to be favorable, to the tune of $150 million this quarter.

UnitedHealth wasn't my favorite health-insurance company before the options issue, nor is it now. It's not an ethics call, but a valuation call -- I simply think that Aetna and WellPoint offer me a better trade-off of risk and reward. And oddly enough, for all of the credit that United Health gets as a superstock, it lags all of those aforementioned peers in terms of five-year appreciation.

The underpinnings of UnitedHealth's business model are perfectly fine, and I'm not looking to encourage any contented shareholders to sell out. Besides, companies with excellent returns on capital, truly impressive industry scale, and reasonable valuations don't come along all that often.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).