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Tickers in this Article: CI, CNO, AGO, ESGR
On Jul 9, Zacks Investment Research upgraded Cigna Corp. (CI) to a Zacks Rank #1 (Strong Buy).

Why the Upgrade?

Cigna delivered positive earnings surprises in the last 4 quarters with an average beat of 13.8%.

Cigna is strongly poised to record earnings growth given a number of strategic investments undertaken. The long-term earnings growth for the company is presently pegged at 11.3%.

The company is focusing more on international expansion. Its global businesses have historically delivered double-digit revenue and earnings growth with very attractive margins and capital efficiency. Cigna is specifically eyeing the key Asian markets where the growing middle class demands better care.

Moreover, with the acquisition of HealthSpring, Cigna expanded in the Seniors and Medicare business. The acquisition of HealthSpring is likely to drive growth going forward and will be highly accretive on a cash basis.

Exiting its Run-off Reinsurance businesses is also a positive, as it was a significant liability on the Cigna.

It also possesses a solid balance sheet, which continues to grow with its strong operating earnings and cash flow generation.

In the last reported quarter, Cigna delivered earnings per share of $1.72, exceeding the Zacks Consensus Estimate by 20.3% and the year-ago earnings by 39%. We expect the multi-insurer to surpass expectations when it reports its second-quarter results

Additionally, for the second quarter, the Zacks Consensus Estimate is pegged at $1.59 per share, up 4.6% year over year. The Zacks Consensus Estimate for 2013 increased 0.5% to $6.44 per share over the last 30 days, reflecting a year-over-year increase of 7.4%. The same for 2014 is pegged at $7.01, increasing 1.7% over the same time frame and translating to a year-over-year improvement of 8.9%.

Other Stocks to Consider

Apart from Cigna, CNO Financial Group, Inc. (CNO) and Enstar Group Limited (ESGR) with a Zacks Rank #1 (Strong Buy), and Assured Guaranty Ltd. (AGO), with a Zacks Rank #2 (Buy) are also worth considering.

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