Cigna Experiences Setback as Second-Quarter Medical Cost Ratio Increases
August 11, 2023
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Cigna Corporation ($NYSE:CI) is a major insurer in the healthcare sector, providing services for individuals, businesses, and government entities. On August 3, 2023, Cigna experienced a setback when its second-quarter medical cost ratio increased. This key performance indicator is a critical measure of an insurer’s profitability and indicates how much of each premium dollar is used to pay out claims. Cigna attributes the higher medical cost ratio to changes in the company’s Medicare Advantage business and higher utilization of medical services.
In response to the increase, Cigna has taken steps to reduce costs and improve efficiencies in its operations. The setback for Cigna comes at a time when the healthcare sector is facing numerous challenges, including rising healthcare costs and changes in policy, due to increased regulation and the implementation of the Affordable Care Act. In spite of these challenges, Cigna remains committed to providing quality health care and services to its customers.
Stock Price
On Friday, CIGNA CORPORATION experienced a slight setback as their stock opened at $287.8 and closed at $286.6, a decrease of 0.4% from the previous day’s closing of 287.6. The medical cost ratio for CIGNA CORPORATION during its second quarter increased, leading to the lower stock prices. The company has expressed their commitment to achieving long-term success and taking measures to ensure that their second quarter medical cost ratio does not affect their future performance. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Cigna Corporation. More…
| Total Revenues | Net Income | Net Margin |
| 186k | 6.64k | 2.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Cigna Corporation. More…
| Operations | Investing | Financing |
| 12.9k | 433 | -8.62k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Cigna Corporation. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 150.05k | 104.53k | 153.69 |
Key Ratios Snapshot
Some of the financial key ratios for Cigna Corporation are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 6.3% | – | 5.2% |
| FCF Margin | ROE | ROA |
| 6.1% | 13.4% | 4.0% |
Analysis
At GoodWhale, we conducted an analysis of CIGNA CORPORATION‘s fundamentals. Based on our Star Chart, CIGNA CORPORATION is strong in dividend and growth but weak in asset and profitability. We believe that value investors, or those who are looking for safe long-term investments, would be interested in CIGNA CORPORATION. With an intermediate health score of 6/10 with regard to its cashflows and debt, it is likely that CIGNA CORPORATION will be able to safely ride out any crisis without the risk of bankruptcy. More…
Peers
Cigna Corp is a large health insurance company that provides a variety of health insurance products and services to its customers. The company competes with other health insurance companies, such as Oscar Health Inc, Humana Inc, and Molina Healthcare Inc.
– Oscar Health Inc ($NYSE:OSCR)
Oscar Health Inc is a health insurance company that offers individual and family plans on and off the health insurance exchanges. The company was founded in 2012 and is headquartered in New York City. As of 2022, Oscar Health Inc has a market cap of 787.25M and a Return on Equity of -28.44%. The company offers a wide variety of health insurance plans, including HMOs, PPOs, and EPOs. Oscar also offers a wide range of ancillary products, such as dental, vision, and life insurance.
– Humana Inc ($NYSE:HUM)
Humana Inc has a market cap of 63.12B as of 2022, a Return on Equity of 17.4%. The company operates in the healthcare sector and is one of the largest healthcare insurance companies in the United States. Humana offers a wide range of health insurance products and services to individuals, families, and businesses. The company has a strong focus on providing quality healthcare and improving the health and well-being of its members. Humana’s mission is to help people achieve their best health and to make healthcare more affordable and accessible. The company’s competitive advantages include its size, scale, geographic reach, and diversified product portfolio. Humana is well-positioned to continue its growth and to help its members live healthier lives.
– Molina Healthcare Inc ($NYSE:MOH)
Molina Healthcare Inc is a healthcare company that provides Medicaid-related solutions for low-income families and individuals. As of 2022, it has a market capitalization of 20.48 billion dollars and a return on equity of 24.89%. The company has a long history of providing quality healthcare services to its customers and is dedicated to improving the lives of its clients. It is headquartered in Long Beach, California.
Summary
CIGNA Corporation is an attractive investment opportunity due to its strong second-quarter financials. These results show that CIGNA has a strong and growing business model which makes it an attractive investment. The company’s operating cash flow is expected to continue to grow and the company is primed to capitalize on healthcare reform initiatives across the US. With a strong balance sheet and extensive reach in the healthcare industry, CIGNA is well positioned for long-term success.
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