UnitedHealth: Berkshire Hathaway Announces Initial, Large Stake in Beleaguered Stock

Key Morningstar Metrics for UnitedHealth Group

• Fair Value Estimate: $400
• Morningstar Rating: ★★★★
• Morningstar Economic Moat Rating: Narrow
• Morningstar Uncertainty Rating: High

UnitedHealth Stock Update

After hours on Aug. 14, Berkshire Hathaway BRK.A revealed that it had accumulated a 5 million share position in UnitedHealth UNH worth about $1.6 billion. Shares in UnitedHealth soared over 10% in after-hours trading, and the other managed care organizations we cover also rose.

Why it matters: Investors appeared to appreciate the vote of confidence from Berkshire Hathaway—Warren Buffett’s investment firm with a penchant for owning competitively advantaged, attractively valued firms—at a time of significant uncertainty for both UnitedHealth and the MCO industry.

• Most MCOs’ shares, including UnitedHealth, have floundered in 2025 on deflated profits and weaker market sentiment due to uncertainty surrounding the long-term earnings power of these organizations. This has created an opportunity for long-term investors like Berkshire Hathaway.
• Although we see elevated uncertainty at UnitedHealth and the other MCOs, right now, due to a combination of mismatched rates and utilization, along with intense regulatory scrutiny, we also still view UnitedHealth as a top-tier MCO with the capacity to handle the problems that it is facing.

The bottom line: While Berkshire’s vote of confidence does not change our $400 fair value estimate or any of our ratings on narrow-moat UnitedHealth, we appreciate that one of the most admired investment firms also sees value in its shares, despite ongoing challenges.

• Even after the rise in shares following this disclosure, we still believe UnitedHealth is trading at a roughly 25% discount to fair value.
• After a decline in profits in 2025 on surging medical utilization in its key at-risk business, we expect UnitedHealth’s adjusted earnings per share could surge over 20% compounded annually through 2030, as the firm pulls levers to improve margins in its MA and provider units, particularly.