Cigna Beats 2Q Expectations With Aid From Evernorth

Cigna Corp. had a better second quarter than equities analysts expected, leading to positive but cautious reviews by Wall Street on the health insurer’s outlook for the rest of the year. Cigna executives credited strong returns from the payer’s Evernorth health services division, saying that they offset higher-than-expected costs related to COVID-19.

Cigna took in total revenues of $43.1 billion in the second quarter, and adjusted income from operations was $1.8 billion, or $5.24 per share. That earnings per share figure beat Wall Street’s projection of $4.96, according to Citi analyst Ralph Giacobbe. However, Cigna’s reported 85.4% medical loss ratio was higher than the 81.8% projected by analysts.

Continuing a trend from the first quarter, when Evernorth drove strong results for the firm, the health services segment was the biggest contributor to profits. Evernorth contributed an adjusted profit margin of 4.3%, or $1.4 billion in the second quarter. Giacobbe wrote in an Aug. 5 note to investors that Evernorth’s “revenue, earnings, and margin [were] all better than [Citi’s] estimates.”

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Peter Johnson

Peter Johnson

Peter has worked as a journalist since 2011 and has covered health care since 2020. At AIS Health, Peter covers trends in finance, business and policy that affect the health insurance and pharma sectors. For Health Plan Weekly, he covers all aspects of the U.S. health insurance sector, including employer-sponsored insurance, Medicaid managed care, Medicare Advantage and the Affordable Care Act individual marketplaces. In Radar on Drug Benefits, Peter covers the operations of (and conflicts between) pharmacy benefit managers and pharmaceutical manufacturers, with a particular focus on pricing dynamics and market access. Before joining AIS Health, Peter covered transportation, public safety and local government for various outlets in Seattle, his hometown and current place of residence. He graduated with a B.A. from Colby College.

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