Here's What Hit UnitedHealth Group's (UNH) Performance

ClearBridge Investments, an investment management company, released its “ClearBridge Large Cap Growth Strategy” fourth-quarter 2025 investor letter. The investment philosophy of the strategy is to invest in leading companies that are undervalued by the market in terms of their future growth potential. A copy of the letter can be downloaded here. Large-cap stocks continued their strength in the quarter, driven by strong earnings growth from mega-cap companies and enthusiasm over generative AI. The ClearBridge Large Cap Growth Strategy underperformed the Russell 1000 Growth Index by approximately 900 basis points for the year. It continued to lag behind the benchmark, trailing its 1.2% quarterly advance by about 170 basis points during the fourth quarter. The underweight exposure to mega-cap AI beneficiaries and lower-quality AI-related names contributed to the underperformance. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, ClearBridge Large Cap Growth Strategy highlighted stocks such as UnitedHealth Group Incorporated (NYSE:UNH). UnitedHealth Group Incorporated (NYSE:UNH) is a diversified healthcare company that operates through UnitedHealthcare, Optum Health, Optum Insight, and Optum Rx segments. The one-month return of UnitedHealth Group Incorporated (NYSE:UNH) was 1.48%, and its shares lost 34.85% of their value over the last 52 weeks. On January 7, 2026, UnitedHealth Group Incorporated (NYSE:UNH) stock closed at $341.70 per share, with a market capitalization of $309.525 billion.

ClearBridge Large Cap Growth Strategy stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its fourth quarter 2025 investor letter:

"The performance of our health care holdings was another disappointment. UnitedHealth Group Incorporated (NYSE:UNH), a consistent contributor in the portfolio’s stable bucket for more than a decade, suffered from a combination of negative sentiment and severe mismanagement that caused the stock to lose about half its value in 2025 by the time we exited the position in August. While we had been trimming UnitedHealth consistently since the fourth quarter of 2024, we also believed the company deserved some leeway to turn things around given its long-term track record. In hindsight, UnitedHealth disclosure had always been below average due to the nature of its regulated businesses, as well as the size and scope of the company’s operations, but that lack of disclosure also made it hard to assess the execution issues that the company faced in 2025. Ultimately, despite a decade of solid returns, we lost confidence in UnitedHealth’s ability to navigate a turnaround under new leadership and exited the position."

UnitedHealth Group Incorporated (NYSE:UNH) is in the 18th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 140 hedge fund portfolios held UnitedHealth Group Incorporated (NYSE:UNH) at the end of the third quarter, which was 159 in the previous quarter. In the third quarter of 2025, UnitedHealth Group Incorporated (NYSE:UNH) generated revenues exceeding $113 billion, representing a 12% year-over-year growth due to the expansion of domestic memberships. While we acknowledge the potential of UnitedHealth Group Incorporated (NYSE:UNH) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered UnitedHealth Group Incorporated (NYSE:UNH) and shared SGA Global Growth Strategy's views on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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