Stock Price & Analysis

Analysis and Insights

To determine whether it’s a good time to buy or sell Cigna (CI) stock, we need to analyze both technical and fundamental factors.

Technical Analysis:

Cigna's stock price has been trading near its 52-week high, indicating strong recent performance. The stock closed at $317.79 on March 24, 2025, reflecting its current position within this range.

Valuation Analysis:

Cigna currently has a P/E ratio of 26.59, which is higher than the industry average, suggesting it might be overvalued. However, the company has reaffirmed its full-year 2025 financial outlook, with projected consolidated adjusted income from operations of at least $29.50 per share.

Analyst Sentiment:

Cantor Fitzgerald analyst Sarah James has maintained a Buy rating on Cigna with a price target of $365.00, while the current consensus on the stock is a Strong Buy with an average target of $365.39.

Conclusion:

Given the high valuation and recent market conditions, it may be prudent to consider selling Cigna stock at its current price. However, if you are confident in the company's long-term growth prospects, holding could still be a viable option.

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Cigna's stock price is predicted to reach $365 by the end of 2025, driven by strong analyst consensus and improving fundamentals. The stock has upside potential to $390 if the company successfully navigates its strategic initiatives. Current price trends and Fibonacci levels suggest a bullish outlook.

The S1 support level for CI Stock is $315.54 ,The R1 resistant level for CI Stock is $330.7.

As of the end of day on 2025-04-02, the price of CI Stock was $330.01.

The target price for CI Stock according to analyst rating is 366.22, with the highest price target at 420.00 and the lowest at 323.00. Analysts have a Strong Buy rating on CI Stock overall.

The market cap of CI is $89.7B.

Analysis and Insights

To determine whether Cigna Group (CI) is overvalued, we analyze its valuation metrics, financial performance, and market sentiment.

Valuation Metrics:

Cigna's current valuation metrics suggest it may be overvalued compared to its peers and historical averages:

1. Price-to-Earnings (P/E) Ratio:
   Cigna's trailing P/E ratio is 26.59, significantly higher than the industry average of 15-20 for health care providers. This indicates that investors are paying a premium for its earnings.

2. EV/EBITDA:
   The Enterprise Value-to-EBITDA ratio is 10.33, which is higher than some peers like UnitedHealth Group (UNH), suggesting a premium valuation.

3. Price-to-Book (P/B) Ratio:
   At 2.3, this is higher than the industry average, indicating the stock may be overpriced relative to its book value.

4. Dividend Yield:
   The dividend yield of 1.57% is relatively low compared to other financial and health care stocks, suggesting limited income appeal.

Market Sentiment and Analyst Ratings:

Analysts have mixed opinions on Cigna, with a consensus rating of "Strong Buy" but recent downward revisions in price targets. Key points include:

1. Analyst Price Targets:
   The average price target is $365.39, with a range of $339 to $410. Recent downward revisions by Barclays and Truist Securities reflect concerns about near-term challenges.

2. Earnings and Revenue Growth:
   While Cigna has shown steady revenue growth, its Q4 earnings miss and reduced FY25 EPS estimates have raised concerns about its ability to meet high expectations.

Technical Analysis:

The stock's technical indicators show a neutral to slightly bearish trend:

1. RSI:
   The Relative Strength Index (RSI) is 55.35, indicating the stock is not oversold but is in a neutral zone.

2. MACD:
   The MACD line is slightly above the signal line, suggesting mild upward momentum, but the overall trend remains flat.

3. Fibonacci Levels:
   The stock is trading near the pivot point of $319.51, with resistance at $329.11 and support at $309.91.

Conclusion:

Based on the analysis, Cigna appears overvalued due to its high P/E, EV/EBITDA, and P/B ratios compared to industry peers. While the company has a strong market position and growth prospects, the current valuation may not justify its stock price. Investors should exercise caution and consider waiting for a correction or clearer signs of earnings growth before investing.

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The Cigna Group is a global health services company. Its portfolio of offerings solves diverse challenges across the healthcare system. It offers a differentiated set of pharmacy, medical, behavioral, dental, and supplemental products, and services, primarily through two platforms: Evernorth Health Services and Cigna Healthcare. Evernorth Health Services includes a range of coordinated and point solution health services and capabilities, as well as those from partners across the health care system, in pharmacy benefits, home delivery pharmacy, specialty pharmacy, distribution, and care delivery and management solutions, which are provided to health plans, employers, government organizations and health care providers. Evernorth Health Services also offers MDLIVE virtual care platform. Cigna Healthcare includes the United States Commercial, United States Government, and International Health operating segments, which provide medical and coordinated solutions to clients and customers.

The predicted price for CI stock by 2030 is $400. This forecast is based on strong revenue growth, strategic investments in biosimilars, and positive analyst sentiment with an average target of $365.39, indicating confidence in the company's future performance.

CI has a total of 72500 employees.