Warren Buffett’s Berkshire Hathaway has made a surprise $1.57 billion investment in UnitedHealth, acquiring five million shares amid the healthcare giant’s worst crisis in years. The move sent the stock soaring over 12% in premarket trading, offering a lifeline to a company battered by a 46% year-to-date plunge. UnitedHealth faces mounting challenges, including soaring treatment costs, a federal probe into billing practices, and fallout from a cyberattack compromising nearly 193 million patient records. The insurer also missed Q2 earnings forecasts, slashing its full-year adjusted EPS guidance to $16.
A Contrarian Play?
Buffett’s timing aligns with his hallmark strategy of buying quality firms at their nadir. While the stake represents just 0.5% of outstanding shares, markets view his entry as a bullish signal—especially after Berkshire simultaneously exited its T-Mobile US position. The stock’s rebound to $306 suggests investors are betting on Buffett’s legendary ability to spot undervalued assets, though UnitedHealth’s path to recovery remains fraught with regulatory and financial headwinds.
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