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Shares of some of UnitedHealth’s peers got a bump in the wake of Berkshire’s investment in the healthcare giant, and they all look cheaper based on price relative to expected earnings.

So while we should always try to assess where a stock or sector is headed, the better way to trade is with a simple framework: Any stock can go up and thus be a source of profits. However, owning each stock comes with different levels of risk,

UnitedHealth Group ( UNH 12.04%) has been a solid dividend growth stock for years. Generally, its yield has been fairly low, due to the stock's rising value. Even as the healthcare insurance giant has grown its dividend, its yield hasn't been particularly high or noteworthy.

UNH stock soared after Warren Buffett’s Berkshire Hathaway revealed it bought shares of the healthcare company. Nonetheless, UnitedHealth faces a long list of unresolved issues.

Year to date, the stock has fallen by nearly 45%, which is by no means normal for the healthcare stock. In fact, this is the worst it has performed since the Great Recession, when it tumbled by more than 54% in 2008.

UnitedHealth Group shares popped Friday after Berkshire Hathaway announced it purchased 5 million shares of the insurance giant.

Berkshire Hathaway's $1.6 billion stake in UnitedHealth Group is helping to lift the Dow Jones Industrial Average to a new record as investors pile into healthcare sector funds.

Michael Burry and Warren Buffett invested in UnitedHealth, signaling confidence in its sector and potential for earnings recovery by 2027.