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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Cigna Corporation (XNYS:CI) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
CI
Name:
CIGNA CORPORATION (XNYS:CI)
Sector:
1.74B
Industry:
Healthcare Plans
CEO:
Mr. David Cordani
Total Employees:
73,700
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -138.73% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CIGNA CORPORATION(CI) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND HEALTHCARE PLANS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
286.58
One Month Price Target:
$287.72
Six Month Price Target :
$293.42
Likely Price in One Year's Time:
Ticker:
$300.26
Likely Trading Range Today Under (Normal Volatility)
$285.65
Price Upper limit ($) :
$288.02
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$272.52
This week:
$255.13
This month :
$223.68
Other Primary facts
Market Cap:
87.78B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
305.12M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
14.54%
-16.22%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$351.80
$321.58
$221.36
$251.58
Medium risk (<10%) entry points
Buy Call
Sell Call
$311.74
Buy Put:
Sell Put:
$305.29
$261.34
$267.87
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
CI
Sharpe Ratio:
3.28%
Comparison:
CI, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is -16.75% lower than the industry
& ratio is 44.05% higher than the market/S&P 500 average
Average Returns/Yield of
CI
Daily returns:
0.09%
Weekly returns:
0.44%
Monthly returns:
1.77%
Yearly returns:
24.40%
Comparison of returns:
Average annual returns/yield (last 3 years) is -12.73% below industry average
Classification:
CI, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.51
Statistical test of Returns:
CI has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.43%
Weekly Volatility:
5.44%
Monthly Volatility:
10.88%
Yearly Volatility:
37.69%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.08%
Volatility in last five trading days has been -55.64% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.91%
Weekly VaR:
-10.97%
Monthly VaR:
-21.95%
How Much Can the price of
CI
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-76.03%
This translates to price declining to:
$233.88
This translates to price declining to:
$68.70
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
CI is a 54.90% riskier investment compared to the market/S&P 500 & is 32.70% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 4.55% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
CI
Beta in relation to market/S&P 500--0.71
Expected beta in 1 year's time:
0.748
Expected beta in 3 year's time:
1.058
Unlevered (debt free) Beta:
0.462
Beta in relation to Nasdaq (XNAS):
0.724
Beta in relation to all global stocks::
0.877
Beta Comparison & Analysis
Beta of competitors/peers::
0.975
Beta is -27.19% lower than peers
Average Industry Beta:
0.719
Beta is -1.27% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
14.48%
Sustainable growth rate is -0.99% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.133
Alpha is -18.65% below industry average alpha yield
Alpha is 845% higher than market/& is unsustainably high
Analysis of Cost of Capital of
CI
Equity cost of capital:
0.080
Equity cost of capital is -0.78% below industry mean WACC
Unlevered (without debt) cost of capital:
5.21%
Before-tax cost of debt:
3.59%
After-tax cost of debt:
2.84%
Overall debt rating:
Upper medium A grade (third highest grade),CO8<=0.0429,"Medium BBB grade (Fourth highest grade)
Weighted average cost of capital (WACC):
2.84%
WACC is 2.46% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$580.03
Revenue growth rate per share of (3Y):
1.89
Annual revenue growth rate is 125.72% above the industry average
EPS:
$16.12
Expected Annual growth rate of EPS (3Y):
5.02%
Expected future EPS growth rate is -51.45% lower than the Healthcare Plans industry
Free cash flow (FCF) per share:
$21.39
-
-
Debt per share
$101.64
EBITDA per share
$35.66
Valuation Analysis Today of
CI
P/E Ratio:
17.09
P/E Ratio of Competitors/Peers:
29.59
P/E ratio is -42.24% lower than main peers & is -22.20% lower than the industry
Stock price/value with industry average P/E ratio: $354.11
CI is -19.07% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.49
Price to sales ratio is -36.42% below the industry mean
P/B (Price to book value ratio):
1.89
Price to free cash flow: 13.40
Price to free cash flow ratio is 19.72% higher than the industry
Net income growth rate (3Y):
48.48%
Net income growth rate is -160.14% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 6.63%
Dividend yeild: 1.48%
Previous Dividend: $1.12
Previous adjusted dividend: $1.12
Previous Dividend: $4.24
Expected next dividend best case: $1.57
Expected next dividend worst case: $0.67
Average dividend payment (long-term): $0.90
Average dividend increase/decrease (growth rate) % per period: 402.00%
Expected next dividend payment date: 21/09/2022
Expected next dividend record date: 09/06/2022
-
Previous dividend payment date: 23/06/2022
Previous dividend record date: 06/08/2022
-
Dividend History:
2022-06-07--$1.12
2021-12-06--$1.00
2021-06-07--$1.00
2022-03-08--$1.12
2021-09-07--$1.00
2021-03-09--$1.00
Dividend growth rate is 11855.26% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
67.29%
Net debt to equity ratio:
62.41%
Debt to assets ratio:
20.32%
Net debt to assets ratio:
18.85%
Debt-to-asset ratio is -68.52% below industry average
Ability to repay debt:
Interest coverage ratio:
9.12
Interest coverage ratio is 208.57% more than industry average
Looking forward:
Debt growth rate:
2.28%
Annual debt growth is -99% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.675
Statistical significance of correlation:
CI has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.624
Stock price is 8.22% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.624
Correlation of price movement with Nasdaq (^IXIC):
0.025
Covariance of price movement with the market:
0.035
Kurtosis
8.706
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.056
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
CI
Gross Profit Margin Ratio:
-
Operating Profit Margin Ratio:
0.00%
-
Net Profit Margin Ratio:
-
Effective Tax Rate:
20.18%
Effective tax rate is 21.25% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
11.69%
Return on equity (ROE) is -236.56% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.53%
Return on assets (ROA) is -191.49% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 1.7 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
2.4M
Each employee generates 59% more revenue than industry average revenue per employee
EBITDA generated per employee:
147.6K
Each employee generates 89% more EBITDA than industry average revenue per employee
Profit generated per employee:
73.1K
Each employee generates 75% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
23.6K
Each employee generates 72% more free cash flow than industry average revenue per employee
Assets/Capital per employee
1.1M
Each employee generates 72% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
CI
EDWARDS LIFESCIENCES CORPORATION (XNYS:EW)
HCA HEALTHCARE, INC. (XNYS:HCA)
BECTON, DICKINSON AND COMPANY (XNYS:BDX)
STRYKER CORPORATION (XNYS:SYK)
ZOETIS INC. (XNYS:ZTS)
IQVIA HOLDINGS INC (XNYS:IQV)
ELEVANCE HEALTH, INC. (XNYS:ELV)
HUMANA INC. (XNYS:HUM)
CENTENE CORPORATION (XNYS:CNC)
Current Analyst Ratings
Strong buy�25%
Buy�29%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
176.98B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
-
-
-
13.05B
-
-
-
-
1.19B
2.93B
10.88B
-
5.39B
6.82B
1.38B
5.39B
Statement of Cash Flow
Date:
Period:
717.00M
Differed Income Tax :
- 138000.00K
Stock Based Compensation :
-
Change in Working Capital :
- 66000.00K
Accounts Receivables:
- 540000.00K
Other Working Capital:
- 63000.00K
Other Non-Cash Items:
319.00M
Net Cash Provided by Operating Activities:
2.03B
Investments in PP&E:
- 288000.00K
Net Acquisitions:
- 57000.00K
Purchases of Investments:
- 1671000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
4.42B
731.00M
5.16B
20.99B
-
-
-
3.66B
45.80B
33.71B
731.00M
-
-
83.91B
236.52B
152.61B
21.87B
2.17B
-
-
-
24.04B
31.01B
-
39.12B
121.53B
106.45B
4.00M
33.42B
- 1492000.0K
-
March 31, 2022 at 6:00:00 AM
170.16B
46.09B
152.53B
1.46B
33.19B
28.8B
1.69B
-
- 324000.00K
-
93.00M
- 1368000.00K
- 357000.00K
- 539000.00K
- 2171000.00K
- 23000.00K
- 488000.00K
5.06B
5.55B
2.03B
- 288000.00K
1.74B
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
CI
2023
2024
2025
2026
2027
$385.22
$403.60
$422.86
$443.05
$464.19