UnitedHealth Stock Rallies From 5-Year Lows as CEO and Other Insiders Scoop Up Shares

UnitedHealth (UNH) insiders scooped up shares after the insurer’s stock swooned to a five-year low last week amid a federal fraud investigation and sudden leadership change. 

CEO Stephen Hemsley—who stepped back into the chief executive role Tuesday following the resignation of Andrew Witty—bought 86,700 shares at an average price of $288.57, a regulatory filing Friday showed. CFO John Rex bought more than 17,000 shares, while director Kristen Gil added 3,700. Other directors including John Noseworthy and Tim Flynn also bought stock last week.

Shares of UnitedHealth rose more than 8% Monday to close near $316 following the insiders’ moves, but even with Monday’s gains, the stock lost nearly half its value over the past five weeks.

Shares had dropped to a five-year low Thursday following reports the Justice Department is investigating the healthcare giant for possible Medicare fraud. That news came just two days after the company announced the resignation of its CEO and withdrawal of its full-year outlook. Hemsley, Witty’s replacement, previously served as the company’s CEO from 2006 to 2017. 

UnitedHealth’s stock was singlehandedly responsible for dragging the Dow’s daily performance into negative territory more than once since mid-April. As recently as April 16, it was the most expensive, and most influential stock in the blue-chip index.