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what it is
Cigna sells health insurance and pharmacy benefits, which means it gets paid to manage your care and your prescriptions.
how it gets paid
Last year Cigna made $274.9B in revenue. Pharmacy services was the main engine at $148.4B, or 54% of sales.
why it's growing
Revenue grew 11.2% last year. 84.4% is the number to watch because medical care ratio tells you whether earnings can keep rising.
what just happened
Cigna posted a latest-quarter EPS of $17.52, while the last reported quarter also beat consensus at $8.08 versus $7.88.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
95/100 earnings predictability — you can trust these numbers
9.8x trailing p/e — the market's not buying it — or you found a deal
2.3% dividend yield — cash in your pocket every quarter
14.5% return on capital — nothing to write home about
xvary composite: 63/100 — average
What they do
Cigna sells health insurance and pharmacy benefits, which means it gets paid to manage your care and your prescriptions.
Cigna wins because it sits in two toll booths at once: insurance and pharmacy benefits. Evernorth generated 54% of 2024 adjusted pretax income, while Cigna Healthcare produced 46%, so you are not betting on one engine. That scale matters when medical care ratio (claims as a share of premium dollars → how much care costs eat revenue → less room for profit) still rose only to 84.4%, and expense ratio (overhead as a share of revenue → what it costs to run the machine → more efficiency) fell to 5.0% from 5.9%.
How they make money
$274.9B
annual revenue · their business grew +11.2% last year
Pharmacy services
$148.4B
Medical insurance
$82.5B
Dental and supplemental benefits
$19.2B
Government-sponsored coverage
$16.5B
Other fees and services
$8.2B
The products that matter
core health coverage
Medical plans
part of the $274.9B revenue base
This is the center of gravity. The page does not give a segment split, but the whole company produced $274.9B in revenue on a 3.0% net margin, so pricing and claims discipline matter more than storytelling.
scale business
ancillary employer benefits
Dental, disability and life
included in the same $274.9B system
These products help deepen employer relationships. We do not have revenue detail here, so the honest takeaway is that they support the broader distribution engine rather than stand alone in the numbers on this page.
relationship glue
benefits sold across channels
Employer, government and individual plans
$78B market cap against $274.9B revenue
The stock trades at roughly 0.3x sales. That tells you the market does not pay health insurers for top-line size alone. It pays for durable earnings on top of that size.
distribution scale
Key numbers
9.8x
trailing p/e
You are paying 9.8 times earnings for a company with projected 8.5% earnings growth, which is cheap versus the market.
$274.9B
annual revenue
This is not a niche insurer. Cigna processed nearly $275B in revenue last year.
14.5%
return on capital
Return on capital (profit earned on invested money → how efficiently management uses cash → higher is better) at 14.5% says this business still throws off solid economics.
$355
18-month target
The 18-month target implies about 22% upside from $291.44, which is the valuation case in one number.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 75 / 100
- long-term debt $30.9B (28% of capital)
- net profit margin 3.6% — keeps 4 cents of every dollar in revenue
- return on equity 22% — $0.22 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in CI 3 years ago → it's now worth $10,310.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
Cigna posted a latest-quarter EPS of $17.52, while the last reported quarter also beat consensus at $8.08 versus $7.88.
The company kept cost discipline even as utilization stayed elevated. Adjusted expense ratio fell to 5.0% from 5.9%, which helped offset a medical care ratio of 84.4%.
$202.4B
revenue
$17.52
eps
2.54%
surprise
the number that mattered
84.4% is the number to watch because medical care ratio (claims as a share of premiums → what care costs eat → profit pressure) tells you whether earnings can keep rising.
-
earnings per share grew 9%, despite elevated utilization trends.
-
the medical care ratio rose only 120 basis points to 84.4%, a much smaller increase than the rise experienced by other companies.
-
meanwhile, tight cost controls forced the adjusted expense ratio down from 5.9% a year-earlier to 5.0% in 2025.
-
this year’s earnings will likely be uncharacteristically flattish.management’s profit outlook of at least $30.25 per share represents the worst annual comparison since earnings growth turned negative in 2016. heightened investments will be required to put in place the new infrastructure for the rebate model (see below).
-
assumptions for the healthcare operations include a medical care ratio between 83.7% and 84.7%, and lower membership across individual exchanges offset by growth in small and select markets.
source: company earnings report, 2026
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What could go wrong
the #1 risk is profit pressure during the rebate-model transition.
med
profit pressure during the rebate-model transition
Management already warned that 2026 earnings will likely be uncharacteristically flat because it needs to invest in new infrastructure for the rebate model.
If EPS stalls around the at-least-$30.25 guide instead of expanding beyond the $30.40 estimate, the 9.8x multiple may be less of a bargain than it looks.
med
claims-cost inflation on a 3.0% margin
This business only keeps about 3 cents of every revenue dollar. That is the quiet part loud. When your margin is this thin, small cost surprises do outsized damage.
A one-point margin squeeze would take a third out of that 3.0% profit margin. You do not need a disaster for earnings to feel it.
med
the stock stays cheap because the market has seen this movie before
CI trades at 9.8x trailing earnings and still lagged the index by $3,570 on a $10,000 investment over the last three years. Cheap can stay cheap when growth turns flat.
If earnings predictability stays high but earnings growth stays low, you may collect a 2.3% yield and little else.
The combined risk picture is simple: a $274.9B scale business can absorb a lot, but not with infinite grace when net margin is only 3.0% and the near-term profit guide is basically flat.
source: institutional data · regulatory filings · risk analysis
Pay attention to
the key metric
2026 EPS against the at-least-$30.25 guide
Q4 was strong, but the stock probably does not rerate until full-year profit starts moving again.
margin risk
whether 3.0% net margin holds
When a business only keeps 3 cents on the dollar, even small cost pressure matters more than headline revenue growth.
sentiment
if institutional selling keeps showing up
679 buyers versus 822 sellers in 3Q2025 is not catastrophic. It is still the wrong direction if you want a multiple rerating.
earnings
the next quarter after the $8.55 EPS beat
You want to see whether the strong Q4 was the start of a trend or just a good quarter before a slower year.
Analyst rankings
short-term outlook
average
Momentum score 3. In human-speak: analysts do not see a strong short-term edge here right now.
risk profile
average
Stability score 3 means typical stock risk — not especially safe, not especially wild.
chart momentum
average
Technical score 3 says the chart is behaving like the broader market. No special signal.
earnings predictability
95 / 100
Management is unusually consistent. The numbers usually arrive close to where they were expected.
source: institutional data
Institutional activity
679 buyers vs. 822 sellers in 3q2025. total institutional holdings: 0.2B shares.
source: institutional data
Price targets
3-5 year target range
$229
$480
$291
current price
$355
target midpoint · +22% from current · 3-5yr high: $660 (+125% · 24% ann'l return)
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