UnitedHealth Group Inc said on Monday that it planned to affirm its 2007 earnings forecast of $3.49 to $3.50 per share in conjunction with its annual investor conference on Tuesday.
The largest U.S. health insurer by market value also forecast 2008 earnings of $3.95 to $4 per share on revenue of $83 billion, repeating projections issued in October.
Analysts are anticipating a more detailed review of the company's operations and forecast during the investor meeting in New York.
UnitedHealth has been through a tumultuous period over the past 18 months, beginning with the departure of longtime Chief Executive William McGuire following a stock options scandal. The Minneapolis-based company has restructured its management and shuffled its top executives.
We expect the investor day to serve as the last step in the resetting of expectations for investors, Lehman Brothers analyst Joshua Raskin said in a note to clients last week.
Raskin said he was projecting earnings-per-share increases of 17 percent this year and 13 percent in 2008 for UnitedHealth, down from annual growth of at least 25 percent in the seven years through 2006.
In October, UnitedHealth forecast long-term annual growth of 13 percent to 16 percent a year.
UnitedHealth shares have climbed more than 13 percent in the fourth quarter, outpacing a roughly 7.5 percent rise for the Standard & Poor's Managed Health Care index.
We see the investor day as more of a building block towards improved sentiment and operating performance rather than a major catalyst in and of itself, especially given strong stock price performance thus far in the fourth quarter, UBS analyst Justin Lake said in a research note last week. (Reporting by Lewis Krauskopf; editing by Lisa Von Ahn)