Andrew Witty out as CEO, Stephen Hemsley in, as UnitedHealth suspends financial guidance

John Boylan, an analyst with Edward Jones, wrote that he believed the company’s “business model of being a one-stop shop for health care services is sound and eventually will translate into growth with new management as issues are resolved.”

Utterback of Morningstar wrote that UnitedHealth Group “remains the strongest managed care organization we cover with a significant margin for executional error like we are seeing currently.”

The CEO change “doesn’t strike us terribly surprising in light of recent business developments and deterioration in investor trust,” wrote Whit Mayo, an analyst with Leerink Partners. The suspension of financial guidance is more concerning, Mayo added, although it might let Hemsley “settle into the role, figure out trend, and begin the process of reestablishing some credibility’’ with investors.

This marks the second time Hemsley has stepped into the CEO role at a critical juncture for the company.

When he did so back in 2006, some former executives told the Minnesota Star Tribune it had been the lower-profile Hemsley who brought a basic business discipline to the company when it was sorely needed following a string of acquisitions dating to the 1990s. It was Hemsley’s company, they said, even as McGuire, the commanding physician-turned-executive, did most of the talking at meetings with stock analysts.

Described over the years as everything from a numbers guy to a brainy professor type, Hemsley suggested an appetite to dig into the problems as he soberly described the path ahead.