NEW YORK (Reuters)—UnitedHealth Group Inc.'s quarterly profit soared past estimates, fueled by growth across its health plans and continued benefits from Americans' moderate use of health care services.
The largest U.S. health insurer by market value also significantly boosted its full-year profit forecast on Thursday.
UnitedHealth, considered a bellwether because of its size and diversity, kicked off the first-quarter earnings season for health insurers, whose shares have outperformed the market this year.
UnitedHealth's net income rose to $1.35 billion, or $1.22 per share, from $1.19 billion, or $1.03 per share, a year earlier.
Analysts on average expected 89 cents per share, according to Thomson Reuters I/B/E/S.
Revenue rose 9.7% to $25.43 billion. Analysts were looking for $24.95 billion.
Membership stood at 38.74 million at the end of March, reflecting growth of 1.9 million, or about 5%.
UnitedHealth projected full-year earnings of $3.95 to $4.05 per share. That compared with its previous range of $3.50 to $3.70 and the analysts' average expectation of $3.78.
The company also sees revenue approaching $101 billion for the year, up from about $100 billion it forecast in January.
UnitedHealth shares have risen 22.5% this year through Wednesday's close, in line with rivals. Health insurer stocks have gained more favor this year as investors gain more comfort with the new health care overhaul law.
Despite unemployment-driven commercial membership losses during the weak economy, U.S. health insurers appear to be on the mend as some companies' 2010 financial performance beat analysts' expectations thanks to a mild flu season, commercial rate increases, investment gains and lower medical utilization.