Cigna Corporation is among the largest health insurance and pharmacy benefits management companies in the US. Besides the US, Cigna also does business in 30 other countries. Based out of Connecticut, Cigna serves close to 190,000 customers including over 86,000 pharmacy accounts. Cigna’s largest pharmacy benefits management customer is the US Department of Defense. Healthcare stocks have been on the radar for investors during the pandemic. Health insurance is an interesting space and with the new Biden administration taking office, any policies on the health insurance front could create new winners.
Recent Performance of Cigna
Cigna reported its third-quarter 2020 earnings in early November 2020. Revenue was up from $38.5 billion in the third quarter of 2019 to $40.9 billion. Shareholders’ net income per share rose from $3.57 in 3Q2019 to $3.78 in 3Q2020.
Cigna CEO David Cordani said, “We delivered strong results that were in line with our expectations. As a result, and as expected, we experienced the return of elevated utilization to more typical levels and ongoing impact of COVID-19. We also continue to take actions to support our customers, our clients, our co-workers, our healthcare professionals and our communities in these exceptionally challenging times.” He further added, “Looking forward to 2021, we have a number of tailwinds including continued growth momentum, favorable impacts from synergies from our Express Scripts combination, and further administrative synergies. We expect year-over-year headwinds from increased medical costs, largely driven by the ongoing impact of COVID-19.”
Cigna’s stock had a quiet period from March 2020 to October 2020 when many other stocks across the S&P500 and Nasdaq 100 were on an uptrend. However, Cigna has gained more than 25% since October 2020. It closed at $211.17 on 10th February 2021.
Another insurance stock for comparison is Anthem Inc. Its price trend was similar to Cigna’s, staying rather flat from March 2020 to September 2020. Since October 2020, the stock has gained 11%. It closed at $298.17 on 10th February 2021.