Cigna Corporation (NYSE:CI)

http://finance.yahoo.com/news/cramer-5-stocks-keep-rallying-230638696.html

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Insurers are not well positioned yet to deal with increasing hospital negotiating power. Also I think more cyclical exposure is appropriate now.

All signs say green for me....

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valueline

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The company is likely to gain as healthcare legislation changes. A low P/E as well as other factors also help.

CIGNA is poorly run compared with United Health and Wellpoint. They aren't adding as many new customers as UNH and they don't seem to have a clear, specific plan going forward. Even with the low P/E there are better opportunities elsewhere.

High Uncertainty. Would not recommend.

Large Health insurers are going to struggle and smaller and newer companies emerge offering cost savings and innovative price/ service strategies

CIGNA Corp signed Hugh Goverment contract...
Pacificare did't renew...

2008 eps: 3.42 p/e 8.14
2009 eps: 3.85 p/e 7.2
2010 eps: 4.13 p/e 6.7

The valuation based on future ernings looks solid

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I'm looking for a weak managed health care company to give the thumbs down to and this may be it.

I have liquidity concerns for this company in the near-term and pricing concerns in the longer term.

A government sponsored (and subsidized) alternative HMO offering should really hurt this company's pricing and their sequential revenue is already weakening.

On the credit side, they are barely investment grade and their bond yields are pretty rich for a managed health organization which I'm taking as a signal of weakness.

Their dividend is anemic and they've already cut share buybacks out so that's signalling that they may not longer be able to support their own stock price through share buybacks.

Lastly, they are headquartered in Philadelphia and I have a general issue with the ethics of the business community in the greater Philadelphia area. That city has been the flashpoint for numerous business scandals that I'm aware of with Adelphia being the largest that comes to mind, but there are others. Must be something in the water (or possibly the sharing of book cooking techniques around the lockerrooms of the executive health clubs).

Thumbs down to Cigna!

PEG = 0.48

Healthcare insurance. Strong medicare/medicade fundamentals. When commercial membership increases so will the stock.

Earnings came in good, ADX and MACD are trending upwards.