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Eddy Elfenbein submits: Shares of UnitedHealth (NYSE:UNH) climbed above $48 yesterday, their highest point in over two months.

I had high hopes for this stock at the beginning of the year, but it’s become a big disappointment. In March, the Wall Street Journal revealed that the CEO, William McGuire, and other officers got their stock-option grants just before big run-ups in the share price. I don’t think they were that lucky, the executives were clearly back-dating their options grants.

Perhaps the most surprising part of this story is that in UnitedHealth’s case, the board allowed it. That’s why this isn’t a criminal matter. Other CEOs won’t be so lucky. Still, UnitedHealth’s stock has suffered as the back-dating scandal has swept Wall Street.

The press loved to moralize over McGuire’s $1.6 billion in options, but the fall in the stock’s price caused investors to lose nearly $20 billion. And remember, this isn’t an accounting scandal. The company is still doing very well.

Last quarter, UNH earned 68 cents a share, four cents more than Wall Street was expecting. The company also said it was on track to earned $2.88 to $2.92 a share for all of 2006. By late-May, shares of UNH fell below $42 a share which means that it was going for about 15 times this year’s earnings.

The scandal is serious but it will have little impact on the company’s business. McGuire is taking the scandal seriously. The company will probably restate its financial results at some point. But for now, Wall Street is again realized how strong UNH is. The company will report earnings again on July 19.

UNH 1-yr chart:

UNH 1-yr chart

Source: UnitedHealth Bounces Back Ahead of Earnings (UNH)