By Sneha S K
(Reuters) -Cigna Group beat Wall Street estimates for third-quarter profit on Thursday, driven by strength in the company’s health services unit Evernorth that houses its pharmacy benefit management business.
The health insurer also reaffirmed its annual adjusted profit forecast of at least $29.60 per share. Analysts on average expected $29.63 per share, according to LSEG data.
Shares of Cigna rose about 2% to $305.20 premarket.
Unlike other insurers that have been battling high costs in government-backed plans, Cigna has been able to shield itself as the company relies more on its pharmacy benefits segment, Express Scripts, and employer-sponsored healthcare plans.
Pharmacy benefit managers help negotiate drug prices and coverage with manufacturers on behalf of employers and health-plan clients.
Quarterly adjusted revenue at its Evernorth health services segment rose about 15% to $60.39 billion, helped by growth in the number of existing clients and strong sales in its specialty pharmacy business, Accredo, which handles high-cost drugs.
Cigna’s medical care ratio, the percentage of premiums spent on medical care, was 84.8% in the quarter, higher than 82.8% a year ago. That compares with estimates of 84.17%.
The increase was partly tied to costs in the company’s “stop-loss” insurance products meant to protect employers from catastrophic expenses, an issue it has previously warned about.
Cigna said the higher stop-loss medical costs were consistent with its expectations and prior commentary.
“We view this as a good quarter for Cigna given the fear of another miss in the company’s stop-loss business,” said Mizuho analyst Ann Hynes. Wall Street is also looking for comments on the 2026 outlook from the company’s conference call later in the day.
On an adjusted basis, it earned a quarterly profit per share of $7.83, beating estimates of $7.65 per share.
Earlier this week, Cigna said it will end prescription drug rebates in some types of heath plans in 2027.
(Reporting by Sriparna Roy and Sneha S K in Bengaluru; Editing by Devika Syamnaath)
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