Centene Corp

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CNC : NYSE : Health Care
$92.22 | %
Today's Range: 87.26 - 94.52
Avg. Daily Volume: 1427000.0
09/22/17 - 4:02 PM ET

Financial Analysis


CENTENE CORP's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. CENTENE CORP has weak liquidity. Currently, the Quick Ratio is 0.99 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 15.35% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)11954.010897.0
EBITDA ($mil)526.0478.0
EBIT ($mil)439.0402.0
Net Income ($mil)254.0170.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)5011.03153.0
Total Assets ($mil)21840.019496.0
Total Debt ($mil)4720.04494.0
Equity ($mil)6378.05529.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin13.312.87
EBITDA Margin4.44.38
Operating Margin3.673.69
Sales Turnover2.121.54
Return on Assets3.661.83
Return on Equity12.486.51
Debt Q2 FY17 Q2 FY16
Current Ratio1.080.89
Debt/Capital0.430.45
Interest Expense62.052.0
Interest Coverage7.087.73


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)172.47170.65
Div / share0.00.0
EPS1.440.98
Book value / share36.9832.4
Institutional Own % n/a n/a
Avg Daily Volume1481784.01758942.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 23.06 for the Health Care Providers & Services industry and a discount compared to the S&P 500 average of 24.93. For additional comparison, its price-to-book ratio of 2.45 indicates a discount versus the S&P 500 average of 3.11 and a discount versus the industry average of 3.28. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, CENTENE CORP proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CNC 19.99 Peers 23.06   CNC 5.17 Peers 11.62

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

CNC is trading at a discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CNC is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CNC 16.56 Peers 16.60   CNC 0.44 Peers 0.68

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

CNC is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CNC trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CNC 2.45 Peers 3.28   CNC 80.15 Peers 21.04

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CNC is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

CNC is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CNC 0.34 Peers 0.90   CNC 54.27 Peers 8.33

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CNC is trading at a significant discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

CNC has a sales growth rate that significantly exceeds its peers.

 

 

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