11:55 AM EDT, 08/20/2025 (MT Newswires) -- UnitedHealth Group's ( UNH ) turnaround could take longer than expected, but potential upside to 2027 earnings per share estimates remains, Morgan Stanley said in a Wednesday note.

"Looking out beyond 2026, we could see a steeper recovery, but the pathway is not entirely clear with still a lot to prove in terms of execution, particularly across Optum Health where we expect a multi-year turnaround," the investment firm said.

According to Morgan Stanley, UnitedHealth's ( UNH ) 2025 EPS guidance of at least $16 was well below general investor expectations of about $18. The guidance reflects recent deficiencies across the company's Optum Health and its insurance arm, it added.

Morgan Stanley, however, reiterated that there is still a "potential pathway" to a 25% upside to its 2027 EPS estimates for the company if it executes against the strategy and accelerates margin improvement across its businesses.

Morgan Stanley lowered its price target on UnitedHealth ( UNH ) stock to $325 from $342, while reiterating an overweight rating.

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