CI
Cigna Corporation
$281.45
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Undervalued
Trading 31.5% below fair value
You pay
$281.45
Bear
$328.49
Fair
$410.62
Bull
$492.74
Bear
$328.49
+16.7%
$31.05 × 11x P/E
Fair
$410.62
+45.9%
$31.05 × 14x P/E
Bull
$492.74
+75.1%
$31.05 × 17x P/E
Key Value Driver
Normalized P/E multiple (14x base case)
Implied Market Multiple
9.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $341.82 from 39 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $410.62 per share.
Warnings
The company's reported profits differ from official accounting profits by 40%. Check what costs are being left out of the adjusted number.
Dividend-based valuation: $2107.81 (above our primary estimate by 379%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $341.82 (from 39 analysts). Our estimate is 29% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples