UnitedHealth Stock (UNH) Poised for Major Rebound—Morgan Stanley Analyst Sees ’Recovery on the Horizon’

Morgan Stanley just dropped a bullish bombshell on UnitedHealth—and Wall Street's taking notice.

The healthcare giant's stock, battered by recent headwinds, now shows all the signs of a textbook comeback play. Analysts point to strengthening fundamentals and undervalued positioning.

Behind the Optimism

It’s not just hope driving this call. Morgan Stanley’s team cites concrete indicators: operational resilience, margin stabilization, and a regulatory environment that’s finally clearing up. They’re betting heavy on management’s ability to execute—even when others hesitate.

Timing the Turnaround

Markets hate uncertainty, but UnitedHealth’s starting to cut through the noise. With systemic pressures easing and internal reforms gaining traction, the setup looks increasingly favorable. Could this be the dip-buying opportunity institutional investors dream about?

One analyst’s recovery is another’s dead cat bounce—but in healthcare investing, sometimes you just have to hold your nose and buy the numbers.

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It is worth noting that Wright ranks 274 out of more than 10,018 analysts tracked by TipRanks. She has a success rate of 64%, with an average return per rating of 13.10% over a one-year timeframe.

Why Wright Is Positive on UnitedHealth

Wright said management showed strong conviction in profit recovery, led by improvements in both Medicare Advantage (MA) and Optum Health. She expects MA margins to MOVE higher, with pre-tax margins rising from 2.0–2.5% in 2025 to 2.5–3.0% in 2026, and potentially reaching the top of the 2–4% range by 2027.

The analyst also addressed the company’s plan exits, which will affect about 600,000 members. Management expects fewer of these members to remain with the company than in past years. While that means lower retention, Wright sees it as a positive because it allows UnitedHealth to focus on more profitable plans, helping margins improve in 2026.

Another encouraging sign is the outlook for Medicare Star Ratings. She noted that about 78% of MA members could be in 4-Star or higher plans in 2026, up from 71% this year, giving the company better visibility on profit recovery.

Looking further ahead, Wright believes UnitedHealth can reach 6–8% pre-tax margins by 2028, supported by stronger performance at Optum Health and continued growth in value-based care.

Is UNH Stock a Buy, Hold, or Sell?

Wall Street has a Strong Buy consensus rating on UnitedHealth stock based on 17 Buys, two Holds, and one Sell recommendation. At $322.28, the average UnitedHealth stock price target implies a 7.37% downside potential.