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Valued at a market cap of $80.3 billion, The Cigna Group (CI) provides insurance and related products and services. The Bloomfield, Connecticut-based company’s core offerings include medical, dental, pharmacy, behavioral health, vision, supplemental benefits, and Medicare/Medicaid plans, as well as health management and wellness solutions.
Companies worth $10 billion or more are typically classified as “large-cap stocks,” and CI fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the healthcare plans industry. With a presence in more than 30 countries and tens of millions of customers worldwide, the company is recognized for its scale, integrated healthcare services, and focus on affordability, accessibility, and quality of care.
Despite its notable strength, this healthcare insurance provider has dipped 18.9% from its 52-week high of $370.83, reached on Sep. 16, 2024. Moreover, shares of CI have fallen 4.5% over the past three months, underperforming the S&P 500 Index’s ($SPX) 8.1% return during the same time frame.
In the longer term, CI has declined 16.9% over the past 52 weeks, considerably lagging behind SPX's 13.6% uptick over the same time period. Moreover, on a YTD basis, shares of CI are up 8.9%, compared to SPX’s 9.1% rise.
To confirm its bearish trend, CI has been trading below its 200-day moving average since mid-May, with slight fluctuations. However, it has been trading above its 50-day moving average since mid-August, with slight fluctuations.
On Jul. 31, CI delivered its Q2 results. Both its adjusted revenue of $67.1 billion and adjusted income from operations of $7.20 per share surpassed the consensus estimates, while improving 11% and 7.1% respectively, from the prior-year quarter. Yet, its shares plunged 10.2% following the earnings release. A 2.1% year-over-year decline in total customer relationships, with both pharmacy and medical customers experiencing a drop compared to the year-ago quarter, may have raised investor concerns, contributing to its negative share price movement.
CI has also lagged behind its rival, Humana Inc. (HUM), which declined 14.3% over the past 52 weeks and gained 22.8% on a YTD basis.
Furthermore, despite CI’s recent underperformance, analysts remain highly 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 $367.86 suggests a 22.3% premium to its current price levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
