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The Estée Lauder Companies Inc. (EL) vs UnitedHealth Group Incorporated (UNH): Which Is the Better Buy in 2026?

As of 2026-06-19, EL is undervalued at $85, with a DCF intrinsic value of $362 and a margin of safety of 77%. UNH is fairly valued at $401, with an intrinsic value of $376 and a margin of safety of -7%. Of the two, EL has the wider margin of safety.

EL
The Estée Lauder Companies Inc.
$84.81
VS
UNH
UnitedHealth Group Incorporated
$400.96

Rewards

EL
  • ★Gross margin of 74.7% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
UNH
  • ★UnitedHealth Group Incorporated scores 73/100 on the Economic Moat Score (Wide Moat), with revenue predictability as the strongest competitive dimension.

Risks

EL
  • ⚠ROIC has declined by 15.4 percentage points over the past 4 years, which may signal competitive erosion.
  • ⚠Despite buyback spending, shares outstanding increased in 3 out of 4 years — stock-based compensation is offsetting repurchases.
  • ⚠FCF yield of 5.9% suggests reasonable valuation assuming continued moderate growth.
UNH
  • ⚠ROIC has declined by 6.9 percentage points over the past 4 years, which may signal competitive erosion.
  • ⚠Gross margin of 18.8% is low, suggesting a competitive or commodity-like market with limited pricing power.
  • ⚠Free cash flow has declined at a 11.8% CAGR over the past 4 years — a concerning trend.

Key Valuation Metrics

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EL
UNH
Valuation
$1.81B
Free Cash Flow
$17.69B
5.89%
FCF Yield
4.86%
N/A
Trailing P/E
30.17
26.63
Forward P/E
19.18
Quality & Moat
13.16%
ROIC
15.60%
-5.95%
ROE
12.18%
74.65%
Gross Margin
18.80%
1.42
PEG Ratio
1.41
Balance Sheet Safety
1.55
Net Debt / Equity
0.44
N/A
Interest Coverage
N/A
2.63
Net Debt / EBITDA
2.18
1.70%
Dividend Yield
2.21%
EL: 2Ties: 2UNH: 7
ELUNH

Historical Fundamentals

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EL

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

UNH

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

$1 Retained Earnings Test

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EL
N/A
Net losses over 3 years — test not applicable
Company had negative cumulative retained earnings
Σ Retained
$-2.23B
Δ Market Cap
$-50.91B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
UNH
$-7.37
created per $1 retained over 3 years
Market Cap Declined
Σ Retained
$26.63B
Δ Market Cap
$-196.16B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Discounted Cash Flow (DCF) Analysis

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EL
76.6% Margin of Safety
Price is 76.6% below estimated fair value
Current Price: $84.81
Fair Value: $362.42
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
UNH
6.6% Overvalued
Price is 6.6% above estimated fair value
Current Price: $400.96
Fair Value: $376.14
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued

Reverse DCF — Market-Implied Growth

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EL

What growth rate is the market pricing in at $85?

+8.0%
Market-Implied FCF Growth Rate

Market pricing in significantly higher growth than history — aggressive.

UNH

What growth rate is the market pricing in at $401?

+14.1%
Market-Implied Owner Earnings Growth
Standard FCF implies +9.8%

The market implies +14.1% Owner Earnings growth, above historical trends.

Standard FCF implies a demanding +9.8%, reflecting heavy growth investment.

Economic Moat Score

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EL
36/100
No Moat
70+ Wide · 40-69 Narrow · <40 None

No durable moat detected, though revenue predictability shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.
UNH
73/100
Wide Moat
70+ Wide · 40-69 Narrow · <40 None

Wide moat driven primarily by revenue predictability. Margin Stability is the area most vulnerable to competitive pressure.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.

Forensic Accounting

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EL
-2.75
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
UNH
-2.45
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Ownership Breakdown

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EL
Insiders 0.4%Institutions 97.2%Retail & Other 2.4%
No. of Institutional Holders1,317
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.
UNH
Insiders 0.2%Institutions 85.9%Retail & Other 13.8%
No. of Institutional Holders4,020
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.

High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.

Insider Buying Activity

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EL
0
Buys (3M)
0
Buys (12M)
FRIBOURG PAUL J
Director
$2.96M
@ $65.00 · 2025-02-07
FRIBOURG PAUL J
Director
$5.72M
@ $65.80 · 2025-02-06
SHRIVASTAVA AKHIL
Chief Financial Officer
$46,053
@ $65.79 · 2025-02-05
FRIBOURG PAUL J
Director
$5.02M
@ $64.48 · 2024-11-19
FRIBOURG PAUL J
Director
$9.86M
@ $64.46 · 2024-11-18
FRIBOURG PAUL J
Director
$10.05M
@ $63.98 · 2024-11-14
SHRIVASTAVA AKHIL
Chief Financial Officer
$65,000
@ $65.00 · 2024-11-14
Open market purchases · includes direct & indirect ownership · excludes option exercises
UNH
0
Buys (3M)
0
Buys (12M)
HEMSLEY STEPHEN J
Chief Executive Officer
$25.02M
@ $288.57 · 2025-05-16
REX JOHN F
President
$5.00M
@ $291.12 · 2025-05-16
GIL KRISTEN
Director
$1.00M
@ $271.17 · 2025-05-15
FLYNN TIMOTHY PATRICK
Director
$491,786
@ $320.80 · 2025-05-14
NOSEWORTHY JOHN H
Director
$93,647
@ $312.16 · 2025-05-14
FLYNN TIMOTHY PATRICK
Director
$511,575
@ $511.57 · 2025-01-17
Open market purchases · includes direct & indirect ownership · excludes option exercises

Open market purchases · includes direct & indirect ownership · excludes option exercises.

Insider Selling Activity

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EL
0
Sells (3M)
10
Sells (12M)
Total value (12M): $1.02B
LA LANDE RASHIDA K
General Counsel
$151,498
@ $94.45 · 2025-11-26
LAUDER JANE A
Director and Beneficial Owner of more than 10% of a Class of Security
$1.68M
@ $94.38 · 2025-11-26
WEBSTER MERIDITH P
Officer
$476,971
@ $87.84 · 2025-11-18
STERNLICHT BARRY S
Director
$364,749
@ $91.83 · 2025-11-11
LAL 2015 ELF TRUST
Trustee
$508.60M
@ $89.70 · 2025-11-06
EVELYN H. LAUDER 2012 MARITAL TRUST TWO
Trustee
$255.22M
@ $89.70 · 2025-11-06
LEONARD A LAUDER 2013 REVOCABLE TRUST
Beneficial Owner of more than 10% of a Class of Security
$249.91M
@ $89.70 · 2025-11-06
FORESTER LYNN
Director
$339,288
@ $91.65 · 2025-08-29
LA LANDE RASHIDA K
General Counsel
$589,594
@ $91.88 · 2025-08-28
LAUDER JANE A
Director and Beneficial Owner of more than 10% of a Class of Security
$1.39M
@ $88.23 · 2025-08-21
FREDA FABRIZIO
Chief Executive Officer
$743,259
@ $67.76 · 2024-11-01
FORESTER LYNN
Director
$364,143
@ $93.61 · 2024-08-23
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives
UNH
1
Sells (3M)
1
Sells (12M)
Total value (12M): $284,000
CONWAY PATRICK HUGH M.D.
Officer
$284,000
@ $355.00 · 2026-04-23
CONWAY PATRICK HUGH M.D.
Chief Executive Officer
$179,645
@ $305.00 · 2025-06-10
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives

Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.

🎭 Mr. Market's Mood

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EL
FearGreed
😨Fear(37/100)

"Market is pessimistic — investigate whether fears are temporary or structural"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
UNH
FearGreed
😏Greed(68/100)

"Market is optimistic — be cautious and ensure you have a margin of safety"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

⚖️ Buffett Signal

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EL
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Fear (37)
UNH
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Greed (68)
View EL Full AnalysisView UNH Full Analysis

Frequently Asked Questions: EL vs UNH

Is The Estée Lauder Companies Inc. or UnitedHealth Group Incorporated more undervalued in 2026?▼

Based on our discounted cash flow model, EL trades at a 76.6% margin of safety (intrinsic value $362 vs. price $85), compared to UNH's -6.6% margin of safety (intrinsic $376 vs. $401).

Which stock has a wider economic moat, The Estée Lauder Companies Inc. or UnitedHealth Group Incorporated?▼

UNH scores 73/100 (Wide moat), while EL scores 36/100 (None moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.

Is UnitedHealth Group Incorporated in financial distress?▼

UNH's Altman Z-Score of 2.9 places it in the Grey zone, signaling elevated bankruptcy risk. EL scores 3.2 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.

Which company has better free cash flow, The Estée Lauder Companies Inc. or UnitedHealth Group Incorporated?▼

The Estée Lauder Companies Inc. (EL) generates a 5.9% free cash flow yield, compared to UnitedHealth Group Incorporated's 4.9%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.

Which stock has higher return on invested capital, The Estée Lauder Companies Inc. or UnitedHealth Group Incorporated?▼

UNH earns 15.6% ROIC versus EL's 13.2%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.

Which dividend is safer, The Estée Lauder Companies Inc.'s or UnitedHealth Group Incorporated's?▼

UNH's dividend earns a safety score of 84/100 (Very Safe), compared to EL's 35/100 (Unsafe). UNH has raised its dividend for 3 consecutive years.