Centene Corp

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CNC : NYSE : Health Care
$84.73 -0.67 | -0.78%
Today's Range: 84.34 - 85.37
Avg. Daily Volume: 1724500.0
07/21/17 - 4:01 PM ET

Financial Analysis


CENTENE CORP's gross profit margin for the first quarter of its fiscal year 2017 has increased when compared to the same period a year ago. The company grew its sales and net income significantly quarter versus same quarter a year prior, and was able to outpace the average competitor in the industry when comparing revenue growth, but not when comparing net income growth. CENTENE CORP has weak liquidity. Currently, the Quick Ratio is 0.94 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 14.59% 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 Q1 FY17 Q1 FY16
Net Sales ($mil)11724.06953.0
EBITDA ($mil)378.0244.0
EBIT ($mil)292.0209.0
Net Income ($mil)139.0-17.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)5564.03705.0
Total Assets ($mil)21362.018652.0
Total Debt ($mil)4647.04280.0
Equity ($mil)6070.05297.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin12.0911.18
EBITDA Margin3.223.5
Operating Margin2.493.01
Sales Turnover2.121.32
Return on Assets3.361.47
Return on Equity11.765.21
Debt Q1 FY17 Q1 FY16
Current Ratio1.020.96
Debt/Capital0.430.45
Interest Expense62.033.0
Interest Coverage4.716.33


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)172.27170.45
Div / share0.00.0
EPS0.79-0.13
Book value / share35.2431.08
Institutional Own % n/a n/a
Avg Daily Volume1687124.01806269.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 24.61 for the Health Care Providers & Services industry and a discount compared to the S&P 500 average of 24.41. For additional comparison, its price-to-book ratio of 2.34 indicates a discount versus the S&P 500 average of 3.04 and a discount versus the industry average of 3.51. 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 20.20 Peers 24.61   CNC 4.89 Peers 13.84

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 15.39 Peers 17.20   CNC 0.51 Peers 1.39

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

CNC is trading at a valuation on par with 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 2.34 Peers 3.51   CNC 81.33 Peers 16.94

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 0.31 Peers 0.93   CNC 83.80 Peers 10.31

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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