United Health Group Financial Statements and Financial Ratios Analyzed
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Thanks for visiting my United Health Group Financial Report page. On this page, you will be able to find preliminary information about United Health Group's current financial performance as well as some historical track records and trends.
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For a more detailed examination of United Health Group's financial performance, please check out the "Financial Report". In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:
- Summarized income statement for the last 5 years.
- Summarized balance sheet for the last 5 years.
- Summary analysis by myself of important income statement, balance sheet, and financial ratio trends and other happenings.
- Five year’s worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
- Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
- Professional financial analysis tips provided in each section to help YOU conduct your OWN financial analysis!
- Each section includes an “in other words” segment. This is were I use plain English to explain concepts.
Enjoy the preliminary information and for a more detailed analysis, buy the financial report!
Sincerely,
Paul Borosky, MBA.
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Sample Financial Report
United Health Group: Brief Summary
United Health Group's headquarters is located in Minnetonka, MN. The company competes in the healthcare plans industry—specifically, the healthcare sector. At present, the United health group employs approximately 325,000 individuals.
From a financial perspective, the organization has a market cap of approximately $264 billion. The beta for the company is .63. This beta suggests that the company's risk is significantly below the overall market. In the last 52 weeks, the company stock prices range from $187.72 to $306.71. Currently, the organization is paying out $1.08 quarterly for dividends per share.
United Health Group Financial Report Sources
“United Health Group 2019 Company Analysis: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA. and owner of Quality Business Plan. In this book, the author selected United Health's 2019 10k, 2017 10k annual report, 2016 10k annual report, 2015 10k annual report, and United Health's 2019 10k annual report as the basis for information gathering.
Section 1: United Health Group Income Statement Analyzed 2015 to 2019
In this section, I walk through a broad definition as to what an income statement is and why it is important. From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail. After each line item is defined and discussed, I finally offer a summary analysis of United Health Group’s important income statement line item trends from 2015 to 2019, in most cases.
Revenue Growth.
United health group ended 2015 with revenues of approximately $157 billion. In the next several years, the organization would increase its revenues to $242.1 billion. This is an average annual growth rate of 11.5%. For mature companies such as this, the growth rate is exceptional.
COGS
United Health Group's cost of goods sold ended in 2015 at $16.2 billion. As a percentage of revenues, the cost of goods sold was 10.3%. In the next year, the cost of goods sold would increase, as a percentage of revenues, to 13.2%. From this point, the next several years, the United health group would lower the cost of goods sold as a percentage of revenues to 11.6%. As for a growth rate, astoundingly, the cost of goods annually is growing at approximately 16.4% rate. This will exceed the revenue growth rate. As a result, if this trend continues, then inevitably, the organization's gross profits, as well as net profits, will suffer. This also indicates that the company is not able to pass on the elevated or increasing cost to their consumers.
United Health Group 2019 Summary Income Statement |
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| Column1 | 2019 | 2018 | 2017 | 2016 | 2015 |
| Revenues | 242,155 | 226,247 | 201,159 | 184,840 | 157,107 |
| COGS | 28,117 | 26,998 | 24,112 | 24,416 | 16,206 |
| Gross Profit | 214,038 | 199,249 | 177,047 | 160,424 | 140,901 |
| SG&A | 35,193 | 34,074 | 29,557 | 28,401 | 24,312 |
| Depreciation | 2,720 | 2,428 | 2,245 | 2,055 | 1,693 |
| R & D | - | - | - | - | |
| Other | 156,440 | 145,403 | 130,036 | 117,038 | 103,875 |
| Operating Expenses | 222,470 | 208,903 | 185,950 | 171,910 | 146,086 |
| EBIT | 19,685 | 17,344 | 15,209 | 12,930 | 11,021 |
| Other Income | - | - | - | - | - |
| Interest Expense | 1,704 | 1,400 | 1,186 | 1,067 | 790 |
| EBT | 17,981 | 15,944 | 14,023 | 11,863 | 10,231 |
| Taxes | 3,742 | 3,562 | 3,200 | 4,790 | 4,363 |
| Net Income | 14,239 | 12,382 | 10,823 | 7,073 | 5,868 |
Section 2: United Health Balance Sheet Analyzed from 2015 to 2019
For United Health Group's balance sheet, I again go through each important line item from the balance sheet. In reviewing each line item, I will define United Health Group’s balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019. Next, I then offer an analysis of United Health Group’s balance sheet important line items.
Cash.
In the last five years, United Health Group's cash position has remained relatively constant. In 2015, the organization had $10.9 billion in cash available. In the next several years, their cash position would slightly increase to $11.9 billion in 2017. However, in the next two years, their position would fall back down to $10.9 billion. This shows that the firm has identified its optimal cash position to ensure sufficient liquidity for operations.
Accounts Receiveable
United health group's accounts receivable has ballooned from $6.5 billion in 2015 to $11.8 billion in 2019. The significant increase in accounts receivable may indicate that the company has loosened its collection standards. As a result, consumers may be taking longer to pay their premiums. However, in comparing accounts receivable for United health group with their percentage of sales, this would indicate that the company ranges between 4.2% to 5%. In the grand scheme of things, this range is relative. This indicates that the firm does, in fact, collect their receivables on time.
United Health Group 2019 Summary Balance Sheet |
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| Column1 | 2019 | 2018 | 2017 | 2016 | 2015 |
| Cash | 10,985 | 10,866 | 11,981 | 10,430 | 10,923 |
| Short Term Investment | 3,260 | 3,458 | 3,509 | 2,845 | 1,988 |
| Account Receivable | 11,822 | 11,388 | 9,568 | 8,152 | 6,523 |
| Inventory | - | - | - | - | - |
| Other | 3,076 | 3,032 | 2,663 | 1,848 | 2,406 |
| Current Assets | 42,634 | 38,692 | 37,084 | 33,879 | 31,639 |
| Net PPE | 37,209 | 8,458 | 7,013 | 5,901 | 4,861 |
| Goodwill | 65,659 | 58,910 | 54,556 | 47,584 | 44,453 |
| Other | 9,334 | 4,326 | 3,575 | 3,037 | 3,118 |
| Total Assets | 173,889 | 152,221 | 139,058 | 122,810 | 111,254 |
| Accounts Payable | 19,005 | 16,705 | 15,180 | 13,361 | 11,994 |
| Accrued Expense | - | - | - | - | - |
| Accrued Taxes | - | - | - | - | - |
| Notes Payable | 3,870 | 1,973 | 2,857 | 7,193 | 6,634 |
| LT Debt - Current | - | - | - | - | - |
| Other | 14,595 | 12,244 | 12,286 | 16,391 | 14,330 |
| Total Current Liabilities | 61,782 | 53,209 | 50,463 | 49,252 | 42,898 |
| LT Debt | 36,808 | 34,581 | 28,835 | 25,777 | 25,331 |
| Other | 10,144 | 5,730 | 5,556 | 2,307 | 1,481 |
| Total Liabilities | 111,727 | 95,994 | 87,036 | 82,621 | 75,793 |
| Common Stock | 9 | 10 | 10 | 10 | 10 |
| Treasury | - | - | - | - | - |
| Retained Earnings | 61,178 | 55,846 | 48,730 | 40,945 | 37,125 |
| Other | - | - | - | - | - |
| Total Equity | 60,436 | 54,319 | 49,833 | 38,177 | 33,725 |
| Total Equity & Liability | 173,889 | 152,221 | 139,058 | 122,810 | 111,254 |
Section 3: United Health Group Financial Ratios Analyzed from 2015 to 2019
For this final section, I have chosen about 16 different financial ratios to calculate for United Health Group from 2015 to 2019. I also review some important United Health Group's financial ratios. I first start with defining the financial ratio. Next, I supply the financial formulas for calculating the specific ratio. Finally, I offer a brief analysis of important financial ratios.
United Health Group Current Ratio:
In 2015, the United Health Group had a current ratio of .74. In the next several years, the organization would lower its current ratio to .69. In general, a current ratio below 1.0 may be cause for concern for an organization. Especially if they do not have daily cash flows like that found in retail stores or grocery competitors. Since the firm has been able to maintain a cash position of approximately $10 billion over a significant amount of time, about five years, then the lower current ratio should be of little concern to investors as long as it stays over .5.
United Health Group Total Asset Turnover:
United Health Group's total asset turnover ended in 2015 at 1.41. In the next several years, the company would reduce its total asset turnover to 1.39. This indicates that the company is using its total assets less efficiently over time. To mitigate this issue, the firm should either sell fixed assets that are not optimally used for efficiency. Or, the organization may need to lower its cash position by paying out dividends or reducing its debt. Either strategy may help improve efficiency throughout the company.
United Health Group Return on Equity:
In 2015, the United Health Group had a return on equity ratio of 17.4%. In the next several years, the company would gradually improve its return on equity. This gradual improvement would lead to a 23.6% return on equity in 2019. The growth and return on equity may be a result of the company using more debt continuously. Or, the firm may be repurchasing stocks in the market to be held as treasury stock.
United Health Group Debt Ratio:
United Health Group's debt ratio ended 2015 at 22.7%. In the next several years, the organization would reduce its debt load to approximately 21.2% in 2019. The reduction in debt does help the company reduce its overall risk for investors. However, by reducing their debt ratio, they are also missing out on opportunities to take on debt at historically low-interest rates. A better strategy may be to take on more debt and use the funds to repurchase stock from the marketplace. This will help increase the debt ratio while driving up stock prices. This would result in significant improvements to the firm’s return on equity.
United Health Group 2019 Liquidity Ratios |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Current Ratio | 0.69 | 0.73 | |||
| Cash Ratio | 0.18 | 0.20 | |||
| Quick Ratio | 0.69 | 0.73 | |||
| Net Working Capital | 3,802 | 5,549 | |||
United Health Group 2019 Asset Utilization |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Total Asset Turnover | 1.39 | 1.49 | |||
| Fixed Asset Turnover | 6.51 | 26.75 | |||
| Days Sales Outstanding | 17.82 | 18.37 | |||
| Inventory Turnover | #DIV/0! | #DIV/0! | |||
| Accounts Receivable Turnover | 20.48 | 19.87 | |||
| Working Capital Turnover | 63.69 | 40.77 | |||
| AP Turnover | 12.74 | 13.54 | |||
| Average Days Inventory | #DIV/0! | #DIV/0! | |||
| Average Days Payable | 0.03 | 0.04 | |||
United Health Group 2019 Profitability Ratios |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Return on Assets | 8.19% | 8.13% | |||
| Return on Equity | 23.56% | 22.79% | |||
| Net Profit Margin | 5.88% | 5.47% | |||
| Gross Profit Margin | 88.39% | 88.07% | |||
| Operating Profit Margin | 8.13% | 7.67% | |||
| Basic Earning Power | 11.32% | 11.39% | |||
| ROCE | 17.56% | 17.52% | |||
| Capital Employed | 112,107 | 99,012 | |||
| ROIC | 38.01% | 96.16% | |||
United Health Group 2019 Long-term Debt |
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| Ratios | 2019 | 2018 | 2017 | 2016 | 2015 |
| Debt Ratio | 21.17% | 22.72% | |||
| Debt/Equity | 60.90% | 63.66% | |||
| Times Interest Earned | 11.55 | 12.39 | |||