UNH stock surges past $394 on Q1 earnings beat, Berkshire sells entire 5M share position

Show summary Hide summary

• 🔥 Quick Facts
• The Earnings Beat That Sparked a 47% Surge from Lows
• Medical Cost Ratio Improvement Drives the Comeback
• Wall Street’s Mixed Signals: Stock Metrics Show the Recovery
• Why Berkshire Just Dumped Its Entire 5 Million Share Position
• Can UnitedHealth Sustain the Momentum Beyond These Earnings?
  • Sources

UnitedHealth stock just surged past $394 on a massive Q1 earnings beat that shocked markets. Warren Buffett’s Berkshire Hathaway, however, just dumped its entire 5 million-share position, raising eyebrows about what insiders really think. Here’s why this $111.7 billion healthcare giant is dividing Wall Street.

The Earnings Beat That Sparked a 47% Surge from Lows

UnitedHealth Group reported first-quarter 2026 results on April 21 that completely reversed market sentiment. The healthcare insurance giant delivered adjusted earnings of $7.23 per share, crushing the Zacks consensus estimate of $6.46 and beating Wall Street’s $6.57 projection. Revenue climbed to $111.7 billion, up 2% year-over-year and well ahead of $109.57 billion expected. The stock’s reaction was swift, with shares jumping approximately 8% in morning trading.

The recovery is particularly dramatic considering where UNH stock stood just weeks earlier. From the start of 2026 through March 27, the stock plummeted from $336 to a low of $259, erasing massive gains and triggering a sell-off across the healthcare sector. Since that bottom, UNH has soared more than 47%, signaling a complete turnaround narrative.

Medical Cost Ratio Improvement Drives the Comeback

What impressed analysts most was UnitedHealth’s improvement in medical cost management. The medical care ratio came in at 83.9%, which included a 20 basis point positive impact from improved rate actions and better cost control. This metric directly fuels profitability, and UNH exceeded expectations by squeezing more efficiency from its operations.

Optum Health, the company’s value-based care segment, reported first-quarter revenues of $24.1 billion, down 3% year-over-year due to fewer value-based care members. However, the improvement in the core insurance business more than compensated, demonstrating management’s ability to navigate sector challenges. The company’s consolidated revenues grew to $111.72 billion, while earnings from operations reached $9.0 billion.

Wall Street’s Mixed Signals: Stock Metrics Show the Recovery

Metric	Value
Q1 Adjusted EPS	$7.23 (beat by $0.47-$0.67)
Q1 Revenue	$111.7B (beat by $2.13B)
Current Stock Price	$393.85-$394 (as of May 15-18)
2026 EPS Guidance	>$18.25 (raised from prior estimate)
YTD Return (2026)	19.17% (from March lows to May highs)

“UnitedHealth Group is on track for a business recovery and a stock price rebound that could add 50% or more to its stock price over time.”

— Yahoo Finance Analysts, Healthcare Research Division

Why Berkshire Just Dumped Its Entire 5 Million Share Position

Here’s where the narrative gets conflicting. Warren Buffett’s Berkshire Hathaway made headlines last May 2026 by completely exiting its UnitedHealth stake in recent 13F filings. The sale is puzzling because Berkshire had just acquired 5 million shares in August 2025 when UNH stock was deeply depressed around $271 per share, representing a $1.6 billion investment at the time.

That means Buffett’s team held the stock through its dramatic crash to $259 in March 2026, then watched it surge past $394 before deciding to sell the entire position. According to market observers, the sale may have occurred near the $394 peak, or potentially earlier near the $376-$380 range. While Berkshire would have booked a significant gain on the investment, the decision to sell at a stock price that recovered 45%+ from lows raises questions about management confidence and what insiders know about valuation going forward.

Can UnitedHealth Sustain the Momentum Beyond These Earnings?

The coming months will test whether UNH’s recovery is real or a temporary bounce. The company faces ongoing headwinds from medical inflation, regulatory pressure from recent healthcare policy shifts, and execution risks at Optum Health. Analysts debate whether the medical care ratio improvement is sustainable or if raising premium rates will trigger pushback from employers and regulators.

Short-term catalysts include the Q2 2026 earnings report expected in late July and full-year guidance confirmation as the year progresses. Dividend increases signal management confidence. The company raised its quarterly dividend to $2.21 per share, demonstrating commitment to shareholders. For long-term investors, the question isn’t whether UNH can beat estimates this quarter, but whether it can sustain mid-teen percentage earnings growth while navigating a changing healthcare landscape.

Sources

• CNBC – UnitedHealth Group Q1 2026 earnings report with EPS and revenue data.
• Morningstar/Business Wire – Official UnitedHealth Group first quarter 2026 results and medical care ratio analysis.
• Seeking Alpha – UnitedHealth 2026 turnaround analysis and guidance raise details.