Eyes On Cigna (CI): Highlighted Storm The Castle Stock

Trade-Ideas LLC identified Cigna (CI) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Cigna

(

CI

) as a "storm the castle" (crossing above the 200-day simple moving average on higher than normal relative volume) candidate. In addition to specific proprietary factors, Trade-Ideas identified Cigna as such a stock due to the following factors:

  • CI has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $262.3 million.
  • CI has traded 1.4 million shares today.
  • CI is trading at 3.68 times the normal volume for the stock at this time of day.
  • CI crossed above its 200-day simple moving average.

'Storm the Castle' stocks are worth watching because trading stocks that begin to experience a breakout can lead to potentially massive profits. Once psychological and technical resistance barriers like the 200-day moving average are breached on higher than normal relative volume, the stock is then free to find new buyers and momentum traders who can ultimately push the stock significantly higher. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize on. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on CI:

Cigna Corporation, a health services organization, provides insurance and related products and services in the United States and internationally. It operates through three segments: Global Health Care, Global Supplemental Benefits, and Group Disability and Life. The stock currently has a dividend yield of 0%. CI has a PE ratio of 16. Currently there are 7 analysts that rate Cigna a buy, 1 analyst rates it a sell, and 5 rate it a hold.

The average volume for Cigna has been 1.6 million shares per day over the past 30 days. Cigna has a market cap of $33.4 billion and is part of the health care sector and health services industry. The stock has a beta of 0.30 and a short float of 0.9% with 1.30 days to cover. Shares are down 9% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Cigna as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.5%. Since the same quarter one year prior, revenues slightly increased by 4.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The current debt-to-equity ratio, 0.41, is low and is below the industry average, implying that there has been successful management of debt levels.
  • Net operating cash flow has increased to $894.00 million or 34.63% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 19.82%.
  • CIGNA CORP' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CIGNA CORP increased its bottom line by earning $8.04 versus $7.82 in the prior year. This year, the market expects an improvement in earnings ($9.29 versus $8.04).
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Health Care Providers & Services industry and the overall market, CIGNA CORP's return on equity exceeds that of both the industry average and the S&P 500.

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