CORPORATESISSUER COMMENT 7 DECEMBER 2015UNITEDHEALTH GROUP INC. (UNH)Moodys Senior Unsecured Rating A3Moodys Outlook NEGBond-Implied Rating A2CDS-Implied Rating A1EDF-Implied Rating A2As of 12/2/2015ANALYST CONTACTSAllerton G. Smith 212-553-4058 Sr Dir-Sr Research Analyst allerton.smith@moodys.comABOUT CAPITAL MARKETS RESEARCHAnalyses from Moodys Capital Markets Research, Inc. (CMR) focus on explaining signals from the credit and equity markets. The publications address whether market signals, in the opinion of the groups analysts, accurately reflect the risks and investment opportunities associated with issuers and sectors. CMR research thus complements the fundamentally-oriented research offered by Moodys Investors Service (MIS), the rating agency.CMR is part of Moodys Analytics, which is one of the two operating businesses of Moodys Corporation. Moodys Analytics (including CMR) is legally and organizationally separated from Moodys Investors Service and operates on an arms length basis from the ratings business. CMR does not provide investment advisory services or products.View the CMR FAQ Contact the CMR team Follow us on TwitterMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc. is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.Market Signals ReviewUnitedHealth Group: Market-Implied Ratings Move in Different Directions Over the last 90 days, UnitedHealth Groups two fixed-income market signals showed different trends. The bond-implied rating recently rose from A3 to A2, but the CDS-implied rating fell from Aa3 to A1 (Figure 1). The EDF-implied rating also dipped by one notch, to A2.FIGURE 1. UNITEDHEALTH GROUP: MOODYS AND MARKET-IMPLIED RATINGS, LAST 90 DAYS (DAILY DATA)Moodys assigned a negative outlook to the debt of UNH on March 20, 2015. That rating action likely triggered a weakening in all three market-implied ratings, which deteriorated from their 12-month high points: a bond-implied rating of Aa3 on March 16, a CDS-implied rating of Aaa on March 27, and an EDF-implied rating of Aa3 on March 25.MOODY'S ANALYTICS CORPORATES2 7 DECEMBER 2015 MARKET SIGNALS REVIEW: UNITEDHEALTH GROUP: MARKET-IMPLIED RATINGS MOVE IN DIFFERENT DIRECTIONSUnitedHealth Groups bond-implied rating exhibited above-average volatility over the last 12 months, fluctuating between a peak of Aa3 and a low of A3. The CDS-implied rating for UnitedHealth Group is now A1, down by four notches from its peak in March. One year ago the EDF-implied rating was Aa3, but it has since declined by two notches.According to our ratings gap-conditioned transition matrices, companies rated A3 with a bond-implied rating of A2 have outperformed the broad market 24% of the time over the following 12 months, matched the markets performance 10% of...
