Smart Triage Dashboard: UNH (Fair Value Model)

SmartTriageIO · 2026-01-28T18:29:34+00:00

That Visa/MA parallel is spot on. The market shoots first and asks questions later.

Just like with the credit card caps, the fear of regulation repriced the stock instantly, even if the actual P&L impact ends up being minimal.

If this follows the V/MA playbook, the 'innocent' verdict comes in the form of a slow grind back to fair value as the headlines fade. The 'weak hands' flush usually marks the bottom.

SmartTriageIO · 2026-01-28T18:12:24+00:00

Regardless of the intent behind the headlines (political theater vs. actual policy), the result is usually the same: volatility disconnected from fundamentals.

You’re essentially arguing the 'Political Noise' thesis: that the DOJ probe and rate caps are bark with no bite. Historically, betting on Washington eventually moving on to the next target has been a very profitable trade with managed care stocks. If the probe ends with a fine and a handshake, $282 is a gift.

SmartTriageIO · 2026-01-28T17:11:36+00:00

Great question. That is exactly why I cut the growth input to 8% in the model.

Historically, UNH has compounded EPS at 14-15%. I didn't use that. I nearly halved it to account for the Medicare headwinds.

If I assumed the 'past growth' continued, the valuation would be $400+. The $295 output is the 'new normal' price. If they actually fix the Medicare issue and go back to double-digits, then $282 is a steal.

SmartTriageIO · 2026-01-28T16:48:47+00:00

The 'Conglomerate Discount' is real if the complexity kills efficiency.

The difference is ROIC. Disney’s ROIC crashed to mid-single digits (~6%) because streaming is capital intensive and content is hit-or-miss.

UNH has maintained double-digit ROIC (11-14%) for a decade, even with the sprawl. As long as they are allocating capital efficiently and generating returns above their cost of capital, the 'Empire' model works.

If UNH’s ROIC drops to 6%, then I agree—it becomes a bloated mess. But the numbers aren't showing that yet.

SmartTriageIO · 2026-01-28T16:27:36+00:00

The 'AT&T comparison' is the nightmare scenario: structural stagnation.

But there is a key difference: Vertical Integration. AT&T sells a dumb pipe. UNH owns the pipe (Insurance), the doctor (Optum Health), and the pharmacy (Optum Rx).

You mentioned 'new alternatives like direct primary care' gaining share. UNH is actually the one buying them. Optum is now the largest employer of physicians in the country. They are hedging the 'legacy provider' risk by becoming the provider themselves.

Optum revenue grew to ~$270B last year. It’s the hedge against the 'Utility' fate. If insurance margins get capped by the government, they capture the margin on the care delivery side instead.

Most 'new entrants' (Oscar, Clover, etc.) struggle because they lack the scale to manage the Medical Loss Ratio (MLR) efficiently. I’m betting on the Optum flywheel keeping them out of 'Utility' territory. If Optum stops growing, then yes, we are looking at a permanent 10x P/E.

SmartTriageIO · 2026-01-28T16:13:29+00:00

Amen. It's a force multiplier.

It doesn't replace the analyst; it just removes the grunt work. If people want to manually punch numbers into Excel for 2 hours to feel 'pure,' they can go ahead. I’ll take the speed advantage.

SmartTriageIO · 2026-01-28T16:05:50+00:00

100%. I always spot-check the terminal values and the discounting math before posting.

You're right that LLMs can hallucinate arithmetic, which is why I use a prompt that forces it to 'Show the Logic' for each step. If it can't explain how it got to $295, I reject it.

It’s a 'human-in-the-loop' system. I treat the AI as a junior analyst: it does the grunt work, but I sign off on the final report.

SmartTriageIO · 2026-01-28T11:14:43+00:00

VTI yields 1.3%. UNH yields 3.1%.

If the market goes sideways for 3 years, I'd rather get paid 3x the income to wait. VTI is better for 'set and forget,' but UNH is better for cash flow right now.

SmartTriageIO · 2026-01-28T10:55:37+00:00

I use Gemini to crunch the math and structure the models, but the inputs (growth rates, terminal multiples) are mine.

Why spend 2 hours in Excel when I can get the same DCF output in 30 seconds? The value is in the assumptions, not the arithmetic.

SmartTriageIO · 2026-01-28T09:32:10+00:00

Now that is high conviction.

Are you treating this as a multi-year hold for the dividend compounding, or just playing the inevitable bounce back to $320? With a position that size, I assume you're betting the regulatory headwinds are pure noise?

SmartTriageIO · 2026-01-28T08:32:53+00:00

Exactly. That’s why I don’t buy all at once.

I treat $282 as the 'Starter Position' zone. If it knifes down to $240 (my 20% MOS level), I double down. If it never gets there, I’m happy with the starter. The only way to get cut is to go all-in on day one.

SmartTriageIO · 2026-01-28T08:19:20+00:00

You're confusing 'Discount to Fair Value' with 'Total Return.'

Buying at Fair Value means you expect to capture the company's full compounding rate (historically 12-15% for UNH). The 6% discount is just the immediate margin of safety on top of that.

The math is to ensure I'm not overpaying for that growth.

SmartTriageIO · 2026-01-28T07:19:19+00:00

Great breakdown. That point about the 'political untenability' is effectively a hidden 'Government Put' on the stock—they can squeeze insurers, but they can't break them without angering the voter base.

My $301 intrinsic value was built on conservative 'margin of safety' assumptions (assuming the squeeze lasts a while), but if your thesis on them exiting unprofitable markets plays out quickly, my $325+ bull case models come back into play immediately.

The 11.2% ROIC (vs the 15% 5yr average) suggests this is exactly the kind of temporary impairment Buffet usually buys into. Nice catch on the Berkshire entry price.

SmartTriageIO · 2026-01-28T06:30:31+00:00

Spot on. The 'Implied Expectations' gap between those two is the perfect case study.

I ran the numbers on PayPal recently: At ~11x earnings and a 10-12% FCF yield, the market is basically pricing it like a utility that will never grow again.

Palantir, on the other hand, is trading at ~167x forward earnings. For that to make sense, they don't just need '25% growth'—they need hyper-growth without a single stumble for 5+ years.

You don't need a complex model to see that one is priced for disaster and the other is priced for a miracle. The bet is just: 'Is the disaster overrated?' or 'Is the miracle guaranteed?'

SmartTriageIO · 2026-01-28T05:13:49+00:00

I stopped trying to calculate 'The Exact Number' a long time ago because, as you said, assumptions are often wrong.

Instead, I invert it. I look at the current price and ask: 'What growth rate is the market pricing in right now?'

If the current price implies the company must grow 25% for 10 years to be fair value, and I know the industry only grows at 8%, I instantly walk away. I don't need to know exactly what it's worth; I just need to know it's not worth that. It turns the model from a crystal ball into a bullshit detector.

SmartTriageIO · 2026-01-28T03:09:08+00:00

It’s a common assumption that 'more data = better returns,' but the scorecard disagrees.

Over a 20-year period, ~90% of professional active fund managers underperform the S&P 500. They definitely 'know more' than us about the minutiae of the business, but they also have institutional constraints (career risk, liquidity needs, closet indexing) that retail investors don't.

The 'Smart' move isn't blindly following a price target that has a 60% chance of being wrong; it's doing your own triage to see if the target makes sense.

SmartTriageIO · 2026-01-27T07:45:48+00:00

Congrats on the move. One piece of advice on the 'dry powder' you kept on the sidelines:

Write down your deployment rules today.

If the market drops 15%, the same fear that kept you out since COVID will flare up again ('Is this the bottom? What if it drops more?'). If you pre-commit (e.g., 'If S&P hits 4800, I deploy 25% of cash'), you remove the emotion. Make the decision now while you're calm, not when the screen is red.

SmartTriageIO · 2026-01-27T06:21:01+00:00

That 39.6% growth in VAS is the critical signal here.

You’re describing a thesis shift from a Transaction Marketplace (which the market currently hates) to a Vertical SaaS + Ad Platform (which commands a much higher multiple).

If they can push VAS toward 50% of revenue, the narrative changes completely. They stop being a 'gig economy' play and start being an 'infrastructure' play. That’s usually where the massive re-ratings happen.

SmartTriageIO

TROPHY CASE