CIGNA Corp. (CI) filed Quarterly Report for the period ended 2009-09-30.
CIGNA Corporation is an investor-owned employee benefits organizations in the United States. Its subsidiaries are major providers of health care products and services group life accident and disability insurance retirement products and services and investment management. CIGNA conducts its business through the following operating divisions: Employee Health Care Life and Disability Benefits; Employee Retirement Benefits and Investment Services; International Life Health and Employee Benefits; and Other Operations. Cigna Corp. has a market cap of $8.12 billion; its shares were traded at around $29.78 with a P/E ratio of 9.3 and P/S ratio of 0.4. The dividend yield of Cigna Corp. stocks is 0.1%. Cigna Corp. had an annual average earning growth of 21.7% over the past 5 years.
Highlight of Business Operations:
On April 1, 2008, the Company acquired the Healthcare division of Great-West Life and Annuity, Inc. (“Great-West Healthcare” or the “acquired business”) through 100% indemnity reinsurance agreements and the acquisition of certain affiliates and other assets and liabilities of Great-West Healthcare. The purchase price was approximately $1.5 billion and consisted of a payment to the seller of approximately $1.4 billion for the net assets acquired and the assumption of net liabilities under the reinsurance agreement of approximately $0.1 billion. Great-West Healthcare primarily sells medical plans on a self-funded basis with stop loss coverage to select and regional employer groups. Great-West Healthcare’s offerings also include the following specialty products: stop loss, life, disability, medical, dental, vision, prescription drug coverage, and accidental death and dismemberment insurance. The acquisition, which was accounted for as a purchase, was financed through a combination of cash and the issuance of both short and long-term debt.
Other revenues include the impact of the futures contracts associated with the GMDB equity hedge program. The Company reported losses of $161 million for the three months ended and $232 million for the nine months ended September 30, 2009 associated with the GMDB equity hedge program, compared with gains of $70 million for the three months ended and $118 million for the nine months ended September 30, 2008. The losses in 2009 reflect increases in stock market values, while the gains in 2008 primarily reflect declines in stock market values. Excluding the impact of these futures contracts, other revenues decreased by 5% for the three months ended September 30, 2009, and decreased by 3% for the nine months ended September 30, 2009 compared with the same periods in 2008. These decreases primarily reflect declines in amortization of deferred gains on the sales of the retirement benefits and individual life insurance and annuity businesses.
CI is in the portfolios of Edward Owens of Vanguard Health Care Fund, Kenneth Fisher of Fisher Asset Management, LLC, David Dreman of Dreman Value Management, Dodge & Cox.
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