We recently published a list of 12 Best Dow Stocks to Buy Right Now. In this article, we are going to take a look at where UnitedHealth Group Incorporated (NYSE:UNH) stands against other best Dow stocks to buy right now.
The Dow Jones Industrial Average is among the most popular stock market indices globally. Known as the Dow, the index monitors the performance of 30 blue-chip companies listed on the US stock exchanges. In 2024, the Dow index returned over 16%, compared to a 25% return for the broader market.
Historically, the Dow has performed better compared to the broader market. According to S&P Global, in the past 30 years up until June 2021, the Dow index returned approximately 11.16% compared to the market’s return of 10.6%. This growth is mainly due to the Dow’s stable, industry-leading companies that offer reliable dividends and returns.
Since the beginning of 2025, Dow Jones has soared over 4% as mega-cap tech stocks surged following their positive earnings. Whereas, the S&P 500 index has jumped by 3.70% year-to-date, as of January 23.
Trump’s AI startup initiative is already pumping the tech stocks. The $500 billion Stargate AI infrastructure project led by Oracle, OpenAI, and SoftBank will accelerate the AI demand. Tech stocks are already dominating the market driven by the huge demand for AI. Nasdaq Composite returned nearly 30% in 2024, outperforming the Dow and the S&P 500.
The U.S. economy is expected to perform better this year compared to 2024 followed by lower interest rates and PCE inflation expected around 2.1%. Economists anticipate a suitable atmosphere for mergers and acquisitions.
Investing in Dow Jones stocks can be appealing in 2025 as they offer huge dividends and returns. The Dow stocks have strong balance sheets and have a proven track record of high yields.
Our Methodology
We shifted through the Dow Jones Index and selected the 12 best Dow stocks based on hedge fund sentiment around each stock using Insider Monkey’s data for Q3 2024. The best Dow stocks are ranked in ascending order of their hedge fund holdings.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Is UnitedHealth Group Incorporated (UNH) the Best Dow Stocks to Buy Right Now?
A senior healthcare professional giving advice to a patient in a clinic.
UnitedHealth Group Incorporated (NYSE:UNH) is one of the largest health insurance companies in the world. The company provides a wide range of health insurance-related services to its consumers. Over the past months, UnitedHealth has expanded its services to several new locations. Moreover, the company intends to reduce the cost of healthcare for consumers as part of its Medicare Advantage Plan for 2025.
On January 21, TD Cowen’s analyst Ryan Langston, maintained a Buy rating on UnitedHealth Group Incorporated (NYSE:UNH) and set a price target of $609, presenting an upside of 83% from the current price level. Langston is bullish on UNH and believes that the company’s ability exceeds market expectations and exhibits solid financial results. The analyst pointed out that the health insurer logged a better-than-consensus medical loss ratio, explaining the reason behind its noteworthy guidance for 2025. Langston remains optimistic about UNH’s strategic initiatives and pricing strategies which are anticipated to drive growth in FY2025.
In FY24, the company’s earnings and revenue surpassed estimates. UnitedHealth Group Incorporated posted revenue of $400 billion, an increase of 8% year-over-year. The company’s earnings from operations in 2024 amounted to $32.3 billion. The company’s Optum Health is expected to serve more than 5.4 million value-based care patients in 2025, indicating a growth of 650,000 over 2024.
“UnitedHealth Group Incorporated (NYSE:UNH), a company that we have owned several times in the past, is the largest health insurer in the United States. UnitedHealth Group also owns Optum, which is a rapidly growing healthcare services company. The environment for the health insurance business remains positive as growth in healthcare spending, driven by chronic diseases and an aging population will continue to outpace overall economic growth. The insurance business benefits from powerful network effects as more members attract more providers and vice versa, which reinforces United’s value proposition and bargaining power with each side of the network. We respect UnitedHealth Group’s management team and have been very pleased with their long-term vision and execution.”
Overall, UNH ranks 7th on our list of best Dow stocks to buy right now. While we acknowledge the potential of UNH to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than UNH but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
