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What's in Store for Cigna's (CI) Earnings in Q2?

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·3 min read
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Cigna Corporation CI is set to report second-quarter 2021 results on Aug 5, before the opening bell.

Q2 Estimates

The Zacks Consensus Estimate for the company’s earnings is pegged at $4.96 per share, indicating a decline of 14.63% from the year-ago quarter’s reported figure.

The consensus mark for revenues stands at $41.27 billion, implying a rise of 5.26% from the prior-year quarter’s reported number.

Factors to Note

Strong performances across the company’s Evernorth, U.S. Medical and International Markets businesses are likely to have contributed to its to-be-reported quarter’s revenues.

Delving deeper into the company’s segments, the Evernorth unit, which was rebranded in September 2020, might have gained momentum from a growing customer base and higher pharmacy scripts volumes in the to-be-reported quarter. Revenues are likely to have been driven by the insourcing of U.S. Medical pharmacy volumes and strong organic growth including a rise in retail network and specialty pharmacy services.

Its U.S. Government business is likely to have gained from customer growth by continuing to expand its addressable markets.

The U.S. Medical business is likely to have benefited from customer growth across the company’s Select segment and Medicare Advantage business, and a rise in premiums and return of the health insurance tax.

The International Markets business revenues are likely to have shown consistent business growth. Operating earnings might have been weighed on by costs incurred to support customers and employees, and investments made in the business for growth.

Numerous cost-curbing initiatives might have offset the company’s selling, general and administration expenses to some extent in the to-be-reported quarter.

Earnings Surprise History

The company boasts an encouraging earnings surprise track. Its bottom line surpassed estimates in three of the trailing four quarters (missed the mark in one), the average surprise being 5.43%. This is depicted in the chart below:

Cigna Corporation Price and EPS Surprise

Cigna Corporation Price and EPS Surprise
Cigna Corporation Price and EPS Surprise

Cigna Corporation price-eps-surprise | Cigna Corporation Quote

What Our Quantitative Model Predicts

Our proven model does not predict an earnings beat for Cigna this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But this is not the case here.

Earnings ESP: Cigna has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate of $4.96 is in line with the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Cigna currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Among other health insurers that have reported second-quarter results so far, the bottom-line results of UnitedHealth Group Inc. UNH, Humana Inc. HUM and Anthem Inc. ANTM beat the respective estimates by 6.6%, 0.44% and 10.88%, respectively.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report

Humana Inc. (HUM) : Free Stock Analysis Report

Cigna Corporation (CI) : Free Stock Analysis Report

Anthem, Inc. (ANTM) : Free Stock Analysis Report

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