Health insurer major, UnitedHealth Group Inc. (NYSE:UNH) has appointed David Wichmann, its president since 2014, as its new CEO. He will replace the current CEO Stephen Hemsley effective Sep 1, 2017.

The news didn’t come as a surprise to us and seems like a normal leadership transition. We also do not expect to see any changes in UnitedHealth’s growth strategy, which is currently focused on expanding the health services business Optum; the government business comprising Medicaid and Medicare, and international operations among others.

UnitedHealth has historically performed strongly and the same is expected to continue in the future given its experienced management team, well-diversified operations and strong capital management which enable it to invest in a number of growth avenues.

In one year, shares of the company have gained 36.3%, almost in line with the industry’s growth of 36%. Given its strong fundamentals, shares are expected to gain momentum in the coming quarters.

Coming back to the news, Hemsley will take on the role of executive chairman to the board and will be fully engaged in the company’s ongoing affairs and long-term growth strategies. The current board chairman Richard Burke will become a lead independent director.

UnitedHealth has chosen an internal candidate to helm its operations given his wide and rich experience of almost two decades with it.

During these years, Wichmann has driven the company’s health benefits unit, UnitedHealthcare (contributing nearly 80% to total revenues in 2016), to great heights by expanding its operations, making a number of acquisitions, investing in technology and more.

UnitedHealth carries a Zacks Rank #3 (Hold). Some better-ranked players in the space are Aetna Inc. (NYSE:AET) , Anthem, Inc. (NYSE:ANTM) and WellCare Health Pans Inc. (NYSE:WCG) . Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Aetna, one of the largest health benefits companies, beat estimates in each of the last four quarters with an average positive surprise of 19%.

Anthem is a health care company, which provides medical products, through its subsidiaries. It surpassed estimates in three of the last four quarters with an average positive surprise of 8.6%.

WellCare Health Plans, provides managed care services targeted exclusively at government-sponsored healthcare programs. It beat estimates in each of the last four quarters with an average positive surprise of 47.4%.

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