UnitedHealth Group Plans to Sell Brazil Operations

by Warren Seah

UnitedHealth Group Inc. (UNH) has announced that it will sell its Brazil operations to a private investor, resulting in a charge of approximately $7 billion. The decision to divest is primarily due to cumulative losses from foreign currency translation.

Despite this development, UnitedHealth’s stock experienced a marginal increase of 0.6% during light premarket trading. While the charge will impact the company’s net earnings in 2024, its adjusted earnings per share outlook remains unchanged at $24.85 to $25.00.

The charge will only be recorded upon the completion of the sale of its Brazil operations, which is anticipated to take place in the first half of 2024. Year-to-date, UnitedHealth’s stock performance has declined by 1%, in contrast to the Health Care Select Sector SPDR ETF (XLV) which has seen a slight increase of 0.3%. Meanwhile, the Dow Jones Industrial Average (DJIA) has recorded a robust gain of 13.8%.

Overall, this strategic move by UnitedHealth Group aims to optimize its global operations and streamline its focus on markets with stronger growth potential.

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