We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Cigna (CI) Unveils '22 Capital Deployment Plans, Shares Up
Read MoreHide Full Article
Shares of Cigna Corporation (CI - Free Report) gained 2.1% on Feb 28 post its announcement of setting an outline for capital deployment prerogatives for 2022.
During the current year, Cigna anticipates generating capital to the tune of more than $12 billion. Included within the total figure are after-tax proceeds worth $5.4 billion stemming from divestiture of CI’s international life, accident, and supplemental benefits businesses located across seven countries to the insurer Chubb.
Cigna plans to undertake share buybacks of over $7 billion in 2022. To that effect, the healthcare provider has already commenced repurchasing shares in 2022 thereby sustaining its robust share repurchase history. In 2021, apart from paying dividends worth $1.3 billion, CI bought back shares worth $7.7 billion.
Coming back to 2022, Cigna bought back shares worth around $1.2 billion between Jan 1 and Feb 23 of the present year. Instilling further optimism, Cigna's directors sanctioned an aggregate increase of $6 billion in its incremental share repurchase authorization during the board of directors' meeting in February. The total repurchase authority of Cigna therefore amounts to $10 billion.
In fact, management has been prioritizing share buybacks as means to deploy capital in 2022 over large-scale mergers or acquisitions. Apart from regular share buybacks and uninterrupted dividend payments, Cigna has other means in place to deploy capital. To usher in innovation, the healthcare provider plans to pursue targeted bolt-on or tuck-in acquisitions. To this effect, CI has plans to undertake strategic investments in capital expenditures to the tune of $1.25 billion and an added investment of $450 million in the venture capital unit of Cigna — Cigna Ventures.
It is worth mentioning that a 12% hike has been approved in the quarterly dividend announced in February 2022. CI has been a regular dividend-paying company but it initiated the concept of quarterly cash dividend from last year. Meanwhile, the healthcare provider also declares special dividends from time to time. Cigna has plans to distribute dividends worth around $1.4 billion in 2022. Its dividend yield of 1.7% remains higher than the industry’s figure of 1%.
All these initiatives make Cigna an attractive stock to yield-seeking investors. The series of capital deployment plans recently unveiled when combined with the dividend hike announced last month highlight CI’s constant efforts to maximize shareholder returns and strength possessed in its business portfolio.
A strong cash balance and adequate cash-generating abilities enable Cigna to undertake such regular capital deployment moves. CI had cash and cash equivalents of $5.1 billion as of Dec 31, 2021 and generated cash flow from operations worth $7.2 billion during 2021.
Some of the other healthcare providers like Humana Inc. (HUM - Free Report) , Anthem, Inc. and HCA Healthcare, Inc. (HCA - Free Report) resorted to tactical capital deployment moves throughout 2021.
Humana returned capital via share buybacks of $80 million and dividends worth $354 million in 2021. In February 2022, HUM’s board of directors approved a 12.5% hike in the quarterly dividend. Humana had $2 billion remaining under its current $3 billion share repurchase authorization as of Feb 17, 2022.
Anthem bought back 5.1 million shares worth $1.9 billion in 2021. As of Dec 31, 2021, ANTM had $4.2 billion left under its authorized share repurchase program. Over the past year, cash dividends amounting to $1.1 billion were paid. In January 2022, Anthem’s board of directors approved a 13% hike in the quarterly dividend.
HCA Healthcare returned capital in the form of $8.2 billion in share repurchases and dividends worth $624 million. As of Dec 31, 2021, the company had $586 million left under its repurchase authorization. In January 2022, HCA Healthcare sanctioned a hike of 16.7% in its quarterly dividend. Its board of directors has increased share repurchase authorization up to $8 billion.
Shares of Humana, Anthem and HCA Healthcare have lost 6.4%, 2.5% and 2.4%, respectively, on a year-to-date basis.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Cigna (CI) Unveils '22 Capital Deployment Plans, Shares Up
Shares of Cigna Corporation (CI - Free Report) gained 2.1% on Feb 28 post its announcement of setting an outline for capital deployment prerogatives for 2022.
During the current year, Cigna anticipates generating capital to the tune of more than $12 billion. Included within the total figure are after-tax proceeds worth $5.4 billion stemming from divestiture of CI’s international life, accident, and supplemental benefits businesses located across seven countries to the insurer Chubb.
Cigna plans to undertake share buybacks of over $7 billion in 2022. To that effect, the healthcare provider has already commenced repurchasing shares in 2022 thereby sustaining its robust share repurchase history. In 2021, apart from paying dividends worth $1.3 billion, CI bought back shares worth $7.7 billion.
Coming back to 2022, Cigna bought back shares worth around $1.2 billion between Jan 1 and Feb 23 of the present year. Instilling further optimism, Cigna's directors sanctioned an aggregate increase of $6 billion in its incremental share repurchase authorization during the board of directors' meeting in February. The total repurchase authority of Cigna therefore amounts to $10 billion.
In fact, management has been prioritizing share buybacks as means to deploy capital in 2022 over large-scale mergers or acquisitions. Apart from regular share buybacks and uninterrupted dividend payments, Cigna has other means in place to deploy capital. To usher in innovation, the healthcare provider plans to pursue targeted bolt-on or tuck-in acquisitions. To this effect, CI has plans to undertake strategic investments in capital expenditures to the tune of $1.25 billion and an added investment of $450 million in the venture capital unit of Cigna — Cigna Ventures.
It is worth mentioning that a 12% hike has been approved in the quarterly dividend announced in February 2022. CI has been a regular dividend-paying company but it initiated the concept of quarterly cash dividend from last year. Meanwhile, the healthcare provider also declares special dividends from time to time. Cigna has plans to distribute dividends worth around $1.4 billion in 2022. Its dividend yield of 1.7% remains higher than the industry’s figure of 1%.
All these initiatives make Cigna an attractive stock to yield-seeking investors. The series of capital deployment plans recently unveiled when combined with the dividend hike announced last month highlight CI’s constant efforts to maximize shareholder returns and strength possessed in its business portfolio.
A strong cash balance and adequate cash-generating abilities enable Cigna to undertake such regular capital deployment moves. CI had cash and cash equivalents of $5.1 billion as of Dec 31, 2021 and generated cash flow from operations worth $7.2 billion during 2021.
Shares of Cigna have gained 3.6% year to date against the industry’s decline of 4.6%. CI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Image Source: Zacks Investment Research
Some of the other healthcare providers like Humana Inc. (HUM - Free Report) , Anthem, Inc. and HCA Healthcare, Inc. (HCA - Free Report) resorted to tactical capital deployment moves throughout 2021.
Humana returned capital via share buybacks of $80 million and dividends worth $354 million in 2021. In February 2022, HUM’s board of directors approved a 12.5% hike in the quarterly dividend. Humana had $2 billion remaining under its current $3 billion share repurchase authorization as of Feb 17, 2022.
Anthem bought back 5.1 million shares worth $1.9 billion in 2021. As of Dec 31, 2021, ANTM had $4.2 billion left under its authorized share repurchase program. Over the past year, cash dividends amounting to $1.1 billion were paid. In January 2022, Anthem’s board of directors approved a 13% hike in the quarterly dividend.
HCA Healthcare returned capital in the form of $8.2 billion in share repurchases and dividends worth $624 million. As of Dec 31, 2021, the company had $586 million left under its repurchase authorization. In January 2022, HCA Healthcare sanctioned a hike of 16.7% in its quarterly dividend. Its board of directors has increased share repurchase authorization up to $8 billion.
Shares of Humana, Anthem and HCA Healthcare have lost 6.4%, 2.5% and 2.4%, respectively, on a year-to-date basis.