Cigna vs Medicare Which Is More Profitable?

Cigna and Medicare are two major players in the healthcare industry, but they operate in different capacities. Cigna is a health insurance company that offers a variety of plans for individuals and employers, while Medicare is a government-funded program that provides healthcare coverage for seniors and some disabled individuals. Investors may consider comparing the stocks of these two entities to assess their performance, financial stability, and growth potential in the ever-changing healthcare landscape.

Cigna or Medicare?

When comparing Cigna and Medicare, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Cigna and Medicare.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Cigna has a dividend yield of 1.98%, while Medicare has a dividend yield of 9.89%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Cigna reports a 5-year dividend growth of 161.81% year and a payout ratio of 50.71%. On the other hand, Medicare reports a 5-year dividend growth of -42.00% year and a payout ratio of 121.20%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Cigna P/E ratio at 25.93 and Medicare's P/E ratio at 24.39. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Cigna P/B ratio is 1.87 while Medicare's P/B ratio is 1.27.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Cigna has seen a 5-year revenue growth of 2.37%, while Medicare's is 0.00%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Cigna's ROE at 7.12% and Medicare's ROE at 5.15%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $282.27 for Cigna and ر.ق4.44 for Medicare. Over the past year, Cigna's prices ranged from $282.27 to $370.83, with a yearly change of 31.37%. Medicare's prices fluctuated between ر.ق3.90 and ر.ق5.57, with a yearly change of 42.87%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.