Cigna Group (CI) stock experienced a pre-market plunge of 11.31% on Thursday, following the company's disappointing fourth-quarter earnings report. The health insurer reported adjusted earnings per share of $6.64, missing analysts' estimates of $7.82, due to higher-than-expected medical costs in its stop-loss insurance business.
Cigna's medical care ratio, the percentage of premiums spent on medical care, increased to 87.9% in the fourth quarter, up from 82.2% a year ago and above analysts' expectations of 84.84%. The company cited higher medical costs for its stop-loss insurance product, which covers employers' self-funded plans when costs surpass a certain threshold due to catastrophic or unexpected medical claims.
Consequently, Cigna also lowered its full-year 2025 profit forecast to at least $29.50 per share, below the analysts' estimates of $31.50 per share. CEO David Cordani stated that the company is "taking corrective actions to address these near-term pressures" in the stop-loss business.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.