Stock Warnings on UNH, GPN, and More
UnitedHealth Group (UNH) saw a 23.6% drop in value after missing earnings expectations and revising its fiscal outlook. Global Payments (GPN) fell 17.43% following its acquisition of Worldpay for $24.25 billion, raising concerns over its cash flow and debt levels. Alcoa (AA) faces challenges from tariffs, leading to a $90 million write-down, while Cleveland-Cliffs (CLF) is also affected by steel tariffs. Freeport-McMoRan (FCX) continues its downtrend in the copper sector.
When a Dow Jones firm misses on earnings expectations, look out below. UnitedHealth Group (UNH) lost 23.6 percent of its value last week when it posted first-quarter results. The firm revised its earnings outlook for this fiscal year.
UNH increased its 2025 medical cost guidance in its Q1 report. The firm set a medical care ratio of 87.5%, up 100 basis points. CFO John Rex guided higher medical utilization from its senior membership base. Optum Health will perform worse, hurt by a less favorable patient mix and revenue profile.
Global Payments (GPN) fell by 17.43% on April 17, dragging PayPal (PYPL), Payoneer (PAYO), and Block (XYZ) lower. The firm will buy the remaining 55% stake in Worldpay from GTCR, a private equity firm. This will cost it $24.25 billion. GPN stock is a risky holding. Its free cash flow growth is not keeping up with the increase in its debt levels over the last three years.
Alcoa (AA) is an unattractive investment. The firm reminded U.S. markets that tariffs hurt American firms and raise costs. CEO William Oplinger highlighted the 91% capacity of the firm’s smelter in Brazil. However, Alcoa will take a $90 million write-down related to U.S. tariffs on aluminum imported from Canada.
Tariffs on steelmakers would also hurt Cleveland-Cliffs (CLF). In the copper sector, Freeport-McMoRan (FCX) is on a steady downtrend that started last October 2024.
