Yahoo
Finance August 1, 2019
It was a healthy quarterly blowout for Cigna (CI).
The health services provider said Thursday its
second quarter earnings came in at $4.30 a share, crushing Wall Street
estimates for $3.74 a share. Total sales came in at $34.4 billion, topping
forecasts for $33.2 billion.
Cigna credited more new business in its
commercial services business and new services for the strong quarter. The
acquisition of pharmacy benefit manager Express Scripts — a deal Cigna closed
on in December 2018 — also propped up results.
Cigna CEO David Cordani in particular called
out product innovation and customer loyalty as key drivers of the quarter in an
interview with Yahoo Finance.
“At the core it’s strong fundamentals. By
delivering great services to our clients and customers we are able to retain an
extremely large amount of our clients and customers,” Cordani said. “We also
earned the right to expand our services through continued innovation and that’s
helping us grow. We also earned net new customers.”
The company’s outlook suggests Cigna sees its
momentum continuing into yearend. Cigna lifted its full year earnings guidance
by 25 cents to 35 cents a share to $16.90 a share. Previously, Cigna guided to
$16.65 a share.
Cigna also disclosed it sees 97% to 98% client
retention in its health services business (mostly the Express Scripts business)
in 2020, up about 50 basis points from its prior outlook.
After an initial pop on the results, Cigna
shares were trading roughly flat by early afternoon trading.
Brian Sozzi is an
editor-at-large and co-host of The First Trade at
Yahoo Finance. Follow him on Twitter @BrianSozzi
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