UBS thinks UnitedHealth is an important portfolio holding trading at a reduction. The firm upgraded shares of the health-care giant to purchase from neutral and raised its goal price to $640 from $520. UBS’ forecast implies roughly 19% upside from Friday’s $539.40 close. Analyst A.J. Rice labeled the stock as “a core holding available at an affordable price,” and said headwinds from earlier within the 12 months that pressured the stock, including worry over elevated medical costs for seniors, have largely subsided . “We imagine that the strong Q3 release from UNH is a clearing event that ought to pave the best way for improved valuation for the stock,” Rice said. The analyst noted the stock trades at 16 times its 2025 earnings per share estimate — that is below its average five- and 10-year PE of 19 times and 18 times earnings, respectively, they said. The corporate posted a third-quarter beat on the highest and bottom line Friday, driven partly by sharp growth in its Optum business. Shares popped greater than 2% following the outcomes. On Monday, the stock rose barely before the bell. Rice added that Medicare Advantage programs will remain an important driver for UnitedHealth, as enrollment growth is already trending near 10% for the 12 months, he said. “The corporate is undertaking various cost cutting initiatives to make sure the business is well positioned to handle growth going forward,” he said. “Also in light of the tougher [Medicare Advantage] rate environment for 2024, these cost and investment actions in Optum Health should provide some mitigation against rate pressures.” UnitedHealth stock has ticked up nearly 2% in 2023. UNH YTD mountain UNH in 2023 UNH YTD mountain UnitedHealth stock. — CNBC’s Michael Bloom contributed to this report.