Warren Buffett Bought This Stock in Secret Last Year To Avoid a Price Hike: Should You Invest?

Warren Buffett is one of the most successful and popular investors in the world. Whenever he buys or sells stocks, it makes global headlines — and he can’t keep his moves secret for long.

According to Securities and Exchange Commission rules, larger investors like Buffett have to disclose their transactions quarterly by filing Form 13F. In August 2025, Buffett announced that his company, Berkshire Hathaway, had accumulated 5 million shares of UnitedHealth Group (UNH). At current market prices, that stake is worth roughly $1.72 billion.

Here’s a look at the details of Buffett’s purchase and whether or not it makes sense for investors to follow his lead.

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Shares of UnitedHealth Group, once a Wall Street darling, have come under fire in recent years, as one bit of bad news has followed another for the company.

The company’s CEO resigned in 2025, and simultaneously, UnitedHealth Group pulled its earnings projections for the year, sending the stock plummeting. The company is also under criminal investigation for possible Medicare fraud, according to the Wall Street Journal.

As a result, shares of UnitedHealth have suffered mightily in 2025. As of Sep. 26, the stock was down over 30% on a year-to-date basis.

In light of all of these factors, Berkshire’s purchase of UNH shares might not come as a huge surprise to long-time Buffett followers. The so-called “Oracle of Omaha” has built his reputation on buying quality companies trading at a discount, and he has often favored insurance businesses. As the largest insurer in the world, UnitedHealth, with a $311 billion market cap and a depressed valuation, sits right in Buffett’s wheelhouse.

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You should never buy at stock just because someone else has, even if that “someone” is billionaire Warren Buffett. Each investment you make should only come after a careful analysis of your own personal time horizon, risk tolerance, financial objectives and the diversification of your overall portfolio. With that in mind, here’s a look at the potential pros and cons of an investment in UnitedHealth Group.

• Pro: Even with reduced earnings estimates, the stock is widely considered “cheap,” trading at a P/E ratio of 14.9

• Pro: Healthcare is traditionally seen as a defensive sector, particularly during recessions. For investors concerned that the stock market is overdue for a correction — or that the economy is nearing a recession — shares of UNH should hold up on a relative basis.

• Pro: UnitedHealth is certainly suffering through a tough period, but it’s not the biggest insurer in the world for nothing. Buffett likes to invest in businesses with predictable cash flow and a defensive “moat” against competitors, and UNH certainly has both.

• Con: Owning a company that’s under criminal investigation is inherently risky. Insurers in general are constantly under regulatory pressure and susceptible to changes in legislation or political pressure that can damage their businesses.

• Con: Even though shares are still significantly lower than their highs, they have rallied about 27% since the announcement of Buffett’s purchase on Aug. 14. Even if the long-term case is solid, gains may be limited over the short term after the big move upward.

There’s no denying that Warren Buffett has an incredible track record when it comes to investing in stocks. But if you want to participate in Buffett’s upside, you might want to consider simply owning shares of his investment vehicle, Berkshire Hathaway, instead of chasing his individual stock purchases.

Buffett’s investment objectives, risk tolerance and time horizon might be very different from your own, and you should always evaluate investments based on your own personal financial situation, not someone else’s. UnitedHealth Group may have a bright future, based on its valuation and leadership in the space. However, it’s still subject to a criminal investigation, regulatory issues and potentially adverse legislation, meaning it has its share of risk as well.

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