CIGNA Corporation (CI) Fourth-Quarter Review

Analysts Matthew Borsch and Mikael Landau at Goldman Sachs (NYSE: GS) have released a report reviewing the fourth-quarter results at CIGNA Corporation (NYSE: CI). CIGNA Corporation reported EPS of $1.03 for the fourth quarter. Analysts had forecast EPS of $0.96.

The core healthcare business earned $194 million, which is below analysts’ estimate of $207 million. The stronger earnings from group life/disability and run-off reinsurance were offset by weaker-than-expected international earnings. The company reported operating cash flow of $420 million.

CIGNA also reaffirmed its outlook for 2010. The company expects EPS to be in the range of $3.75-$4.15 in 2010. The company expects earnings from core healthcare business of $720-$790 million. The guidance does not include the impact of share repurchase. According to analysts, share repurchase could add at least $0.10 to EPS in 2010.

Analysts expect a positive stock reaction to the fourth-quarter results. The CIGNA stock’s recent underperformance as well as weakness in the managed care stocks yesterday on revelation of health reform is unwarranted, according to analysts at Goldman Sachs.