Back to top

Image: Bigstock

Cigna (CI) to Report Q4 Earnings: What's in the Offing?

Read MoreHide Full Article

Cigna Corp. (CI - Free Report) will release fourth-quarter 2019 results on Feb 6, before market open.

In the last reported quarter, Cigna’s earnings of $4.54 per share beat the Zacks Consensus Estimate by 3.89%, led by accretion from the Express Scripts acquisition.

Factors at Play

The Zacks Consensus Estimate for the company’s earnings per share is pegged at $4.19, indicating an increase of 70.33% from the year-ago reported figure. The consensus mark for revenues stands at $35.3 billion, suggesting a 156.7% rise from the year-ago reported figure.

Cigna’s Integrated Medical segment is likely to have driven revenues on customer growth, strengthening of customer relationships, premium rise reflecting underlying cost trends, and the inclusion of Express Scripts and Medicare Part D business. The segment is likely to have seen an increase in global medical customers, backed by growth in select and middle market segments.

In the company’s Health Services segment, earnings are likely to have benefited from organic growth owing to the addition of new pharmacy customers, strong volumes of adjusted pharmacy scripts fulfilled and a continued improvement in specialty pharmacy. The Zacks Consensus Estimate for Health Services revenues stands at $26.3 billion.

The company’s International business is expected to have benefited from business growth and strong margins, partially offset by an unfavorable foreign currency impact.

Cigna’s debt levels are likely to have declined in the fourth quarter as it prioritizes to repay debt that was incurred to fund the purchase of Express Scripts. Share repurchases made by the company during the to-be-reported quarter are likely to have aided the bottom line.

2019 Guidance 

For the full year, the company expects earnings per share in the range of $16.6-$16.9 and revenues within $136-$137 billion while medical customers are projected to grow by approximately 200,000. Medical care ratio is expected in the band of 80.8-81.2%.

Earnings Surprise

The company boasts a decent earnings surprise history, having surpassed estimates in three of the trailing four quarters, the average positive surprise being 5.17%. This is depicted in the graph below:

Cigna Corporation Price and EPS Surprise

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Cigna this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a positive surprise. But that’s not the case here.

Earnings ESP: Cigna has an Earnings ESP of -0.31%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter

Zacks Rank: Currently, Cigna carries a Zacks Rank #2.

Stocks Worth a Look

Here are a few healthcare stocks worth considering as these have the right combination of elements to beat on earnings in the upcoming quarterly results.

Humana Inc. (HUM - Free Report) has an Earnings ESP of +0.15% and a Zacks Rank #3.

 You can see the complete list of today's Zacks #1 Rank stocks here.

Teladoc Health, Inc. (TDOC - Free Report) has an Earnings ESP of +11.70% and a Zacks Rank of 3.

Molina Healthcare, Inc. (MOH - Free Report) has an Earnings ESP of +0.48% and is Zacks #3 Ranked.

7 Best Stocks for the Next 30 Days

Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers “Most Likely for Early Price Pops.”

Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.7% per year. So be sure to give these hand-picked 7 your immediate attention.

See 7 handpicked stocks now >>






 


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Humana Inc. (HUM) - free report >>

Molina Healthcare, Inc (MOH) - free report >>

Cigna Group (CI) - free report >>

Teladoc Health, Inc. (TDOC) - free report >>

Published in