Shares of UnitedHealth Group Inc (NYSE:UNH) are surging 10.1% to trade at $298.71 this morning, after a Securities and Exchange Commission (SEC) filing showed that Warren Buffett's Berkshire Hathaway (BRK.A) had purchased a stake in the company, alongside Lennar (LEN) and D.R. Horton (DHI). Last quarter, around 5 million shares were bought for approximately $1.6 billion. In response to the news, the equity is eyeing its biggest daily pop since March 2020.
This boost in sentiment trails several years of struggles for UnitedHealth. The company has been slammed with headwinds from healthcare costs, Department of Justice (DoJ) probes, the death of CEO Brain Thompson, and more. UNH is now facing off with the overhead 80-day moving average and remains 40% lower in 2025.
Unsurprisingly, the options pits are seeing ample activity. So far 377,000 calls and 121,000 puts have been exchanged so far, 6 times the average daily pace. Most popular are the expiring August 300, 305, and 310 calls, where new positions are being opened.
Short-term traders have been sporting a call-bias. This is per the security's Schaeffer's put/call open interest ratio (SOIR) of 0.44, which stands in the 5th percentile of readings from the past 12 months.
It's also worth noting that the stock has tended to outperform these volatility expectations, per its Schaeffer's Volatility Scorecard (SVS) of 96 out of 100.
