Shares of UnitedHealth Group plunged to a five-year low on Thursday on the New York Stock Exchange after reports of a probe against the company.
The shares of UnitedHealth Group plunged over 19 per cent to hit the low of $248.88 per share.
Here is why UnitedHealth Group stock is falling today.
Why are UnitedHealth Group shares falling?
The Wall Street Journal in a recent report citing unnamed individuals stated that the US Department of Justice was investigating UnitedHealth Group for potential Medicare fraud.
The report added that the Department of Justice has had a probe into the company’s Medicare Advantage business since at least last summer.
Hours later, UnitedHealth released a statement, denying the allegations made in the report.
“We have not been notified by the Department of Justice of the supposed criminal investigation reported, without official attribution, in the Wall Street Journal today,” it said.
Condemning the report, the company said it stands by the integrity of its Medicare programme.
“The WSJ’s reporting is deeply irresponsible, as even it admits that the “exact nature of the potential criminal allegations is unclear.” We stand by the integrity of our Medicare Advantage program.”
However, the statement did little to sway investor sentiments that have been running low for the past few sessions. The latest news adds to the health insurer’s litany of woes, including multiple government inquiries, a sudden change in top leadership and a pulled outlook in the face of soaring medical costs.
Investors and analysts noted that while details on the investigation were limited, they did heighten investor concerns.
“The stock is already in the doghouse with investors, and additional uncertainty will only pile on,” Reuters quoted James Harlow, senior vice president at Novare Capital Management, which owns shares in UnitedHealth, as saying.
UnitedHealth shares dropped every day for the last eight trading sessions, including sinking more than 17 per cent Tuesday when the company abruptly replaced its chief executive officer and suspended 2025 guidance. It has lost more than $110 billion in market value this week.
The past month’s selloff has wiped out nearly $300 billion from UnitedHealth’s market capitalisation, or more than half of its value since its shares hit a record high in November.
UnitedHealth Group share price today
Shares of UnitedHealth Group hit a five-year low of $248.88 apiece on the NYSE, plunging 19.19 per cent as against the previous close.
The stock was down 14.52 per cent at $263.29 per share at 9:04 IST. Over the past five sessions, UnitedHealth Group shares have fallen by as much as 31.74 per cent, as per data by MarketWatch.
