This week’s episode packed in quite a bit—from portfolio reflections and CEO exits to strong results from two European heavyweights. Derek and European DGI kicked things off with a laugh about the weather, but things quickly turned serious as they tackled the dramatic drop in UnitedHealth Group (UNH). We also got some standout earnings updates from Siemens and Allianz, along with thoughtful answers to listener questions on spin-offs, free cash flow, and the appeal (or lack of it) of preferred shares.
⏱️ Timestamps & Tickers
Here’s a quick guide to help you find the main parts of the show:
- 00:01:51 – UNH drama starts
- 00:40:25 – Siemens earnings
- 00:46:15 – Allianz results
- 00:38:10 – Chubb dividend hike
- 00:49:23 – If we had to start over…
- 01:06:52 – Starbucks in China
- 01:15:22 – Caro Ltd mini-review
- 01:17:24 – Dream dividend-paying private companies
📉 UNH: Falling Knife or Rare Opportunity?
The big headline this week was the chaos at UnitedHealth Group. The stock dropped like a rock following:
- A downward earnings revision
- News of rising healthcare costs cutting into Medicare Advantage margins
- CEO stepping down
- A Wall Street Journal report mentioning possible fraud tied to Medicare billing
On paper, UNH looks solid—low payout ratio, strong free cash flow, and a rare dividend yield over 3%. But both hosts agreed: even if the fundamentals check out, the lack of transparency and ethical concerns around the US healthcare model make this a hard pass for them personally. A real “UNH falling knife” situation—look out below.
📈 Dividend Hikes
Only one company made the dividend hike list this week:
- Chubb (CB) increased its dividend by 6.6%
The guys weren’t overly impressed. With a payout ratio under 10% on free cash flow, they expected a bigger bump. The conservative approach continues, but there’s plenty of room for more.
🧾 Siemens & Allianz: Strong Earnings, Solid Execution
Siemens (SIE.DE)
A classic case of “boring is beautiful.” Orders up 10%, revenue up 7%, and a nice 29% jump in industrial profit. Smart Infrastructure was the standout, while Digital Industries continued to lag. Free cash flow dipped a bit, but mostly due to tax payments and acquisitions, including a €9.5 billion bet on AI via Altair. Still delivering like clockwork.
Allianz (ALV.DE)
This one continues to impress. Business volume rose 11.7%, EPS up modestly, and a solvency ratio holding firm above 200%. The property and casualty side led the way, but the life and health division also posted strong growth. Allianz looks like one of the most stable insurance picks on the market right now.
💬 Listener Questions
- Would you buy UNH now?
Only if you truly understand and trust the business. Otherwise, steer clear. - What would you do differently if starting over?
Focus more on dividend safety and conviction. Stay off social media hype. - Preferred stocks – worth it?
Not for these two. They don’t like the stagnant price action. - Caro Ltd (KARO)
Too expensive, not enough dividend history, and unclear growth market. Pass. - Dream dividend payers if they went public?
Lego and IKEA top the wishlist—no surprises there. - Spin-offs like Magnum (Unilever)
Unless it’s top quality, it’s usually a sell.
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