Jim Cramer Calls UnitedHealth Group Incorporated (UNH) a Universal Buy - "The Only Gimme"

We recently published a list of Jim Cramer’s Game Plan: 15 Stocks to Watch. In this article, we are going to take a look at where UnitedHealth Group (NYSE:UNH) stands against other stocks that Jim Cramer discusses.

On Friday, Mad Money host Jim Cramer outlined what investors should focus on in the week, especially pointing to earnings reports from major banks.

“Rumor, innuendo, intrigue these are the stuff of great novels, of fabulous miniseries, riveting plays, and now they’re the stuff of the stock market.”

READ ALSO: Jim Cramer Discussed These 12 Stocks and 10 Stocks on Jim Cramer’s Radar Recently.

He noted the chaotic nature of the current environment and remarked that “this tape has it all,” and emphasized how unpredictable developments from the White House have added to the turbulence. Cramer noted that information is being released constantly, through press conferences, posts on Truth Social, or casual remarks, and that each has the potential to move vast sums of money across asset classes.

“Trillions of dollars in and out of bonds, of currency, of gold, of crypto,” he said, all based on impulsive statements. He pointed out the sheer volume of contradictions in the news cycle and stressed, “Except this isn’t an eight-part blockbuster, it’s our money.” Cramer lamented how even social media activity, like tweets, can trigger massive swings in the markets. He noted that Friday’s market action felt like it was shaped entirely by this dynamic.

Cramer questioned whether the market might be in the process of forming what he called a “liberation day bottom,” a moment when selling pressure finally ends because investors feel that all the bad news is out. But he acknowledged the uncertainty of that theory as he said, “Not sure, I’m just not sure.” He added:

“Have you ever noticed the weekends don’t provide relaxation anymore because the president’s got advisors? He’s got to put people out. He wants to tweet. He’s got meetings. No relaxation time, no downtime…. Monday’s trading, well, let’s just say that it looks like that it’s earning season so it’s gonna be even harder than usual.”

Our Methodology

For this article, we compiled a list of 15 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on April 11. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.

Why are we interested in the stocks that hedge funds pile into? 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

UnitedHealth Group Incorporated (NYSE:UNH)

Number of Hedge Fund Holders: 150

Calling UnitedHealth Group Incorporated (NYSE:UNH) a “universal buy”, Cramer said:

“How about a gimme? I think this company’s the only gimme that I’ve seen this week. This is as close to one as you’re gonna find, not too high a price-to-earnings multiple, not yet overly loved, purely domestic business, has pricing power. This is it. It’s a universal buy.”

UnitedHealth Group (NYSE:UNH) is a healthcare organization that offers health plans, care services, pharmacy support, and wellness programs. It also delivers software, consulting, and data tools to companies in the healthcare sector. Burke Wealth Management stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its Q4 2024 investor letter:

“UnitedHealth Group Incorporated (NYSE:UNH): Before I discuss our decision to reduce United Health, I want to express our sadness and disgust regarding the tragic murder of UHC CEO Brian Thompson. Our thoughts and prayers are with his family. His murder played no role in our decision to reduce UNH.

We cut our weighting in United Health in half following sluggish third quarter earnings and the initial discussion of 2025 guidance that highlighted one too many headwinds for us to maintain a 6% weighting in the stock. The big issue weighing on the managed care stocks during 2024 has been a reduction in Medicare Advantage reimbursement rates. 2024 was year 1 of a 3 year plan by the government to reduce reimbursements for Medicare Advantage plans. For UNH, 2024 was a year of share loss in the Medicare Advantage business as they had to craft plans with higher copays and lower levels of coverage in order to profitably compete in the space. Competitors like Humana and CVS Aetna weren’t quite as aggressive as UNH in 2024 on adjusting their Medicare Advantage plans and those companies achieved the winners curse of selling more money losing plans. Both of those stocks were down 45% for the year as they suffered one earnings debacle after another. UNH managed through the early phases of this more challenging reality better than its competition. As we looked forward to 2025, we expected to see a rebound in Medicare Advantage market share as competitors chose greater price discipline over bankruptcy. We got that. However, joining Medicare Advantage on this list of concerns was higher than expected Medical Loss Rates (the percent of premiums UNH pays for medical care) due to higher utilization in certain popular drugs that the Inflation Reduction Act removed copays from as well as continued disruption related to the Change Health cyber-attack from April. The disruption from the cyber-attack will ultimately pass but is already taking longer to work through than anticipated. Basically, following the attack UNH gave its hospital partners wider leeway when it came to approving treatments to ensure that any treatments that normally would be approved would not be held back as a result of the attack. Naturally, the approval pendulum swung further than planned and this continues to be an issue that UNH will have to work through with hospital partners and customers. The utilization spike related to the Inflation Reduction Act was a new item of concern courtesy of a few pages tucked neatly inside a thousand page bill that nobody read. More benefits for people, yes. Higher premiums coming as a result, yes. Inflation Reduction an appropriate name for a bill that provides this combination, no. All told, the combination of these three headwinds means that 2025 is going to be a year of 8%-10% earnings growth rather than the long-term target of 14%-16% growth. We will continue to assess this position and the appropriate weighting as we move through 2025.”

Overall, UNH ranks 12th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of UNH as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. 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 this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.