Cigna vs UnitedHealth Which Is More Reliable?

Cigna and UnitedHealth Group are two major players in the healthcare industry, with both companies offering a range of health insurance and related services. Both companies have seen strong growth in recent years, fueled by increasing demand for healthcare services. However, Cigna and UnitedHealth Group have different business models and strategies, which have led to differences in their stock performance. Investors looking to invest in the healthcare sector may want to carefully consider the strengths and weaknesses of each company before making a decision.

Cigna or UnitedHealth?

When comparing Cigna and UnitedHealth, 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 UnitedHealth.

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 1.99%, while UnitedHealth has a dividend yield of 2.23%. 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, UnitedHealth reports a 5-year dividend growth of 0.00% year and a payout ratio of 51.26%.

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 25.83 and UnitedHealth's P/E ratio at 1.13. 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 1.86 while UnitedHealth's P/B ratio is 0.17.

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 UnitedHealth's is 0.70%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Cigna's ROE at 7.12% and UnitedHealth's ROE at 15.94%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $279.88 for Cigna and C$24.40 for UnitedHealth. Over the past year, Cigna's prices ranged from $279.88 to $370.83, with a yearly change of 32.50%. UnitedHealth's prices fluctuated between C$21.03 and C$30.05, with a yearly change of 42.89%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.