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Valued at a market cap of $91.8 billion, The Cigna Group (CI) provides insurance and related products and services. The Bloomfield, Connecticut-based company offers a variety of health plans and services, including medical, dental, disability, life, and accident insurance. It also offers specialty products and services in areas like pharmacy management, behavioral health, and vision.
Companies worth $10 billion or more are generally described as “large-cap” stocks and Cigna Group fits right into that category, with its market cap exceeding this threshold. The insurance company maintains sales capabilities in more than 30 countries and jurisdictions and has more than 190 million customer relationships around the world.
The healthcare insurance company has dipped 13% from its 52-week high of $370.83, achieved on Sep.16. On top of that, shares of CI have declined nearly 9.2% over the past three months, significantly underperforming the broader Dow Jones Industrials Average’s ($DOWI) 9.8% gains over the same time frame.
Moreover, in the longer term, CI has gained 7.7% on a YTD basis, underperforming DOWI’s 18.8% returns. Nonetheless, shares of CI are up nearly 25.2% over the past 52 weeks, outpacing DOWI’s 23.9% gains over the same time frame.
To confirm its recent bearish trend, CI has been trading below its 200-day moving average since mid-November and has remained below its 50-day moving average since early December.
On Oct. 31, shares of CI closed up marginally following its better-than-expected Q3 earnings release. Its revenue of $63.7 billion climbed 29.8% from a year ago primarily due to large client wins in the Evernorth Health Services segment and outpaced the Wall Street estimates of $59.83 billion. Moreover, its adjusted EPS improved 10.9% year-over-year to $7.51 and exceeded the forecasted figure by 4%. However, a 2.9% decline in its medical customer base and a rise in total benefits and expenses partially offset the positives.
However, CI has significantly outpaced its rival, Humana Inc. (HUM), which declined 43.4% over the past 52 weeks and 38.2% on a YTD basis.
Despite CI’s recent underperformance, analysts remain strongly optimistic about its prospects. The stock has a consensus rating of “Strong Buy” from the 23 analysts covering it, and the mean price target of $397.73 suggests a 23.3% premium to its current levels.
