EU and US could reach trade deal this weekend - Reuters
On Monday, Raymond (NSE:RYMD) James increased its price target on shares of CIGNA (NYSE:CI) to $385 from the previous target of $360, while reiterating a Strong Buy rating on the stock. With a market capitalization of $89.2 billion and annual revenue exceeding $255 billion, CIGNA stands as a prominent player in the Healthcare Providers & Services industry. The adjustment comes in response to CIGNA’s first-quarter results of 2025, which surpassed expectations. CIGNA reported an adjusted earnings per share (EPS) of $6.74, outperforming the consensus estimate of $6.35 and Raymond James’ forecast of $6.32.According to InvestingPro analysis, CIGNA is currently trading below its Fair Value, suggesting potential upside opportunity. The platform’s comprehensive analysis reveals 12 additional key insights about CIGNA’s financial health and market position.
The better-than-expected performance was partially attributed to the later-than-anticipated divestiture of the company’s Medicare business. This sale contributed less than $20 million to the quarter’s earnings, equivalent to an EPS increase of 4-6 cents. Additionally, CIGNA’s core insurance operations exceeded projections. Trading at a P/E ratio of 18.3x and demonstrating strong financial metrics, the company continues to deliver solid results. The medical loss ratio (MLR) for the quarter was reported at 82.2%, slightly below the street’s expectation of 82.3%. The MLR was impacted by the Medicare business, which added approximately 100 basis points to the first-quarter MLR.
CIGNA’s Healthcare division exceeded Raymond James’ estimates by $137 million, with reported earnings of $1,287 million against an estimate of $1,150 million. The Evernorth segment also outperformed estimates, bringing in $1,434 million compared to the anticipated $1,407 million. Evernorth’s specialty growth was noted at 6.6%; however, excluding the impact of the VillageMD dividend, which created a headwind of around $33 million, EBIT growth for the segment would have been 11%, and overall Evernorth EBIT growth would have been 8% for the first quarter of 2025.
The company’s management has indicated that the stop loss business is performing in line with year-to-date expectations, with trends running at elevated levels as anticipated, along with some favorable outcomes in surgical activity. Analysts expect the pricing in this market to remain firm for the next few years to bring margins back to normalized levels. InvestingPro data shows CIGNA maintains an overall "GREAT" financial health score of 3.01, with particularly strong marks in profit and price momentum metrics. Furthermore, CIGNA’s management has revised its 2025 EPS guidance upwards by $0.10, now forecasting at least $29.60. The MLR guidance for the year remains unchanged at 83.2-84.2%, although Raymond James suggests that this may be a conservative estimate, considering the first-quarter MLR was artificially high and the guidance was not increased.For detailed insights into CIGNA’s valuation and growth prospects, including exclusive financial metrics and expert analysis, check out the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Cigna Corporation reported strong first-quarter 2025 results, surpassing Wall Street expectations. The company achieved an adjusted earnings per share (EPS) of $6.74, exceeding the forecast of $6.35, and reported revenue of $65.5 billion, above the projected $60.38 billion. Additionally, Cigna raised its full-year 2025 EPS guidance to at least $29.60, reflecting confidence in its strategic initiatives and market positioning. The company also completed the divestiture of its Medicare business to HCSC, aligning with its focus on specialty pharmacy and pharmacy benefit services.
In another development, Jefferies analyst David Windley increased the price target for Cigna shares from $376.00 to $397.00 while maintaining a Buy rating. Windley highlighted the strong performance of Cigna’s Specialty segment as a key driver of success and suggested that the company’s conservative guidance for the upcoming quarter reflects a cautious growth approach. He emphasized Cigna’s lower medical loss ratio variability and insulation from legislative risks as factors bolstering investor confidence.
These recent developments underscore Cigna’s strategic focus on healthcare innovation, cost management, and market expansion, positioning the company favorably against industry trends.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.