1.
$UnitedHealth(UNH)$ is down just about 16% after the CEO stepped down and suspended guidance.
This drop has brought the dividend yield to an all time bight of 2.64%.
UNH has never paid a yield this high, not even during the pandemic.
The chart below shows the TTM yield but it’s the forward yield that should interest you more.
$8.4 annual dividend / $317.87 = 2.64%.
I realize guidance has been suspended and there is a lot of uncertainty around $UNH which is why the stock is falling like a knife right now.
If we take a step back and look at the business it still looks fundamentally strong.
Long term earnings are projected to grow by 7.25%.
It currently pays a 2.64% yield.
Based on its FCF multiple the stock has a potential upside of 6.65% per year.
This gives us a projected long term return assumption of 16.54%.
Of course, no investment is risk free so decide if the juice is worth the squeeze.
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