Centene Corporation (NYSE: CNC) and Cigna Corporation (NYSE:CI) are both large-cap medical companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, risk, earnings, dividends, analyst recommendations, institutional ownership and valuation.

Earnings and Valuation

This table compares Centene Corporation and Cigna Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Centene Corporation $43.65 billion 0.32 $2.19 billion $4.55 18.05
Cigna Corporation $40.53 billion 1.10 $4.21 billion $8.68 20.09

Cigna Corporation has higher revenue, but lower earnings than Centene Corporation. Centene Corporation is trading at a lower price-to-earnings ratio than Cigna Corporation, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

93.6% of Centene Corporation shares are owned by institutional investors. Comparatively, 86.9% of Cigna Corporation shares are owned by institutional investors. 3.0% of Centene Corporation shares are owned by insiders. Comparatively, 1.3% of Cigna Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Centene Corporation and Cigna Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Centene Corporation 1 4 13 0 2.67
Cigna Corporation 0 2 15 0 2.88

Centene Corporation presently has a consensus price target of $85.60, suggesting a potential upside of 4.21%. Cigna Corporation has a consensus price target of $179.56, suggesting a potential upside of 2.97%. Given Centene Corporation’s higher possible upside, research analysts plainly believe Centene Corporation is more favorable than Cigna Corporation.

Profitability

This table compares Centene Corporation and Cigna Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Centene Corporation 1.72% 14.62% 4.24%
Cigna Corporation 7.46% 17.40% 4.04%

Risk & Volatility

Centene Corporation has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, Cigna Corporation has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500.

Dividends

Cigna Corporation pays an annual dividend of $0.04 per share and has a dividend yield of 0.0%. Centene Corporation does not pay a dividend. Cigna Corporation pays out 0.5% of its earnings in the form of a dividend.

Summary

Cigna Corporation beats Centene Corporation on 9 of the 16 factors compared between the two stocks.

About Centene Corporation

Centene Corporation is a healthcare company. The Company provides a portfolio of services to government sponsored healthcare programs, focusing on under-insured and uninsured individuals. The Company operates through two segments: Managed Care and Specialty Services. The Company’s Managed Care segment provides health plan coverage to individuals, through government subsidized programs, including Medicaid, the State Children’s Health Insurance Program (CHIP), Long Term Care, Foster Care, dual-eligible individuals (Duals) and the Supplemental Security Income Program, also known as the Aged, Blind or Disabled Program (ABD), Medicare, and Health Insurance Marketplace. Its Specialty Services segment consists of its specialty companies offering a range of healthcare services and products to state programs, correctional facilities, healthcare organizations, employer groups and other commercial organizations, as well as to its own subsidiaries.

About Cigna Corporation

Cigna Corporation (Cigna), together with its subsidiaries, is a health services company. The Company offers medical, dental, disability, life and accident insurance and related products and services. The Company’s segments include Global Health Care, Global Supplemental Benefits, Group Disability and Life, and Other Operations and Corporate. Its Global Health Care segment aggregates the commercial and Government operating segments. Its commercial operating segment encompasses the United States commercial and certain international healthcare businesses serving employers and their employees, other groups, and individuals. Its Global Supplemental Benefits segment offers supplemental health, life and accident insurance products in selected international markets and in the United States. Its Group Disability and Life segment provides group long-term and short-term disability insurance, group life insurance, accident and specialty insurance and related services.

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