Wednesday, May 03, 2006

UnitedHealth Group Suspect Judgment

The shareholder revolt may have succeeded in forcing some governance changes. Much like the keystone cops chasing the get-a-way perhaps a deterrent has been established. Mr McGuire was quoted by Reuters as saying that they should have moved sooner to make the changes. The comment is rich given that Mr.McGuire was the prime beneficiary of the suspect compensation program. The board's judgment is suspect. The stock is trading close to its 52 week lows. Will this stock reward shareholders or just a select few option holders. What other errors in judgment are embedded? My prediction is a rough ride. Classaction lawsuit if there was ever one.