UnitedHealth Leads Dow Gainers After Analyst Upgrade

UnitedHealth Group's stock climbed 1% in morning trade Monday, making it the biggest percentage gainer among Dow Jones Industrial Average components, after Jefferies upgraded the health insurer on an improving outlook for the managed care business. Analyst David Windley at Jefferies raised his rating to buy from hold, and lifted his stock price target by 33% to $141, which is 17% above current levels, from $106. He said management's actions to correct missteps that led him to downgrade the stock to hold in July 2014 have gained traction much more swiftly than he expected. "The outlook continues to improve and we don't see any major hurdles slowing down fundamental momentum," Windley wrote in a note to clients. "More specifically, headwinds are turning to tailwinds in the [Medicare Advantage] business." In addition, the acquisition of Catamaran Corp. announced at the end of March strengthens its pharmacy benefit management business. The stock has gained 19% year to date, while the Dow has advanced 1.5%.

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