NYSE:CNC

Stock Analysis Report

Executive Summary

Centene Corporation operates as a diversified and multi-national healthcare enterprise that provides programs and services to under-insured and uninsured individuals in the United States.

Snowflake

Fundamentals

Very undervalued with adequate balance sheet.


Similar Companies

Share Price & News

How has Centene's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

7.8%

CNC

3.9%

US Healthcare

0.07%

US Market


1 Year Return

-27.4%

CNC

-6.7%

US Healthcare

8.9%

US Market

Return vs Industry: CNC underperformed the US Healthcare industry which returned -6.7% over the past year.

Return vs Market: CNC underperformed the US Market which returned 8.9% over the past year.


Shareholder returns

CNCIndustryMarket
7 Day7.8%3.9%0.07%
30 Day5.1%3.5%-0.3%
90 Day-9.3%-0.05%-1.6%
1 Year-27.4%-27.4%-5.1%-6.7%11.3%8.9%
3 Year49.2%49.2%37.0%30.6%46.3%36.8%
5 Year120.0%120.0%61.3%50.4%62.1%44.3%

Price Volatility Vs. Market

How volatile is Centene's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Centene undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CNC ($48.75) is trading below our estimate of fair value ($110.36)

Significantly Below Fair Value: CNC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CNC is good value based on its PE Ratio (15.7x) compared to the Healthcare industry average (21x).

PE vs Market: CNC is good value based on its PE Ratio (15.7x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: CNC is good value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: CNC is good value based on its PB Ratio (1.7x) compared to the US Healthcare industry average (2.5x).


Next Steps

Future Growth

How is Centene forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

16.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CNC's forecast earnings growth (16% per year) is above the savings rate (2.7%).

Earnings vs Market: CNC's earnings (16% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: CNC's earnings are forecast to grow, but not significantly.

Revenue vs Market: CNC's revenue (7% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: CNC's revenue (7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CNC's Return on Equity is forecast to be low in 3 years time (14.3%).


Next Steps

Past Performance

How has Centene performed over the past 5 years?

33.9%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: CNC's earnings have grown significantly by 33.9% per year over the past 5 years.

Accelerating Growth: CNC's earnings growth over the past year (18.8%) is below its 5-year average (33.9% per year).

Earnings vs Industry: CNC earnings growth over the past year (18.8%) exceeded the Healthcare industry 5.6%.


Return on Equity

High ROE: CNC's Return on Equity (10.3%) is considered low.


Return on Assets

ROA vs Industry: CNC's Return on Assets is below or equal to the Healthcare industry average last year.


Return on Capital Employed

ROCE Improving: CNC has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Centene's financial position?


Financial Position Analysis

Short Term Liabilities: CNC's short term assets ($13.6B) exceeds its short term liabilities ($12.7B)

Long Term Liabilities: CNC's short term assets (13.6B) exceeds its long term liabilities (9.4B)


Debt to Equity History and Analysis

Debt Level: CNC's debt to equity ratio (58.3%) is considered high

Reducing Debt: CNC's debt to equity ratio has increased from 55.5% to 58.3% over the past 5 years.

Debt Coverage: CNC's debt is well covered by operating cash flow (30%).

Interest Coverage: CNC's interest payments on its debt are well covered by EBIT (6.4x coverage).


Balance Sheet

Inventory Level: CNC has a low level of unsold assets or inventory.

Debt Coverage by Assets: CNC's debt is covered by short term assets (assets are 1.900200x debt).


Next Steps

Dividend

What is Centene's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.6%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate CNC's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate CNC's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if CNC's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CNC's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CNC's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Centene's salary, the management and board of directors tenure and is there insider trading?

5.2yrs

Average management tenure


CEO

Michael Neidorff (76yo)

23.4yrs

Tenure

US$26,122,414

Compensation

Mr. Michael Frederic Neidorff has been Chairman and Chief Executive Officer of Centene Corporation since May 2004 and its President since April 23, 2019. From May 1996 to May 2004, Mr. Neidorff served as P ...


CEO Compensation Analysis

Compensation vs. Market: Michael's total compensation ($USD26.12M) is about average for companies of similar size in the US market ($USD11.18M).

Compensation vs Earnings: Michael's compensation has been consistent with company performance over the past year.


Management Age and Tenure

5.2yrs

Average Tenure

50.5yo

Average Age

Experienced Management: CNC's management team is seasoned and experienced (5.2 years average tenure).


Board Age and Tenure

14.5yrs

Average Tenure

71.5yo

Average Age

Experienced Board: CNC's board of directors are seasoned and experienced ( 14.5 years average tenure).


Insider Trading

Insider Buying: CNC insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$151,02229 Jul 19
Jessica Blume
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,850
Max PriceUS$52.99

Ownership Breakdown


Management Team

  • Michael Neidorff (76yo)

    Chairman

    • Tenure: 23.4yrs
    • Compensation: US$26.12m
  • Keith Williamson (67yo)

    Executive VP

    • Tenure: 12.9yrs
    • Compensation: US$3.43m
  • Jesse Hunter (43yo)

    Executive VP & Chief Strategy Officer

    • Tenure: 6.8yrs
    • Compensation: US$6.16m
  • Ed Kroll (59yo)

    Senior Vice President of Finance & Investor Relations

    • Tenure: 12.4yrs
  • Jeff Schwaneke (43yo)

    Executive VP

    • Tenure: 3.6yrs
    • Compensation: US$9.96m
  • Chris Isaak (52yo)

    Senior VP

    • Tenure: 3.5yrs
  • Brandy Burkhalter (46yo)

    Executive VP of Operations

    • Tenure: 0yrs
    • Compensation: US$7.57m
  • Mark Brooks (49yo)

    Executive VP & Chief Information Officer

    • Tenure: 3.5yrs
    • Compensation: US$4.04m
  • Shannon Bagley

    Senior Vice President of Human Resources

    • Tenure: 0yrs
  • Matthew Snyder

    Senior Vice President of Internal Audit

    • Tenure: 0.8yrs

Board Members

  • David Steward (67yo)

    Independent Director

    • Tenure: 16.4yrs
    • Compensation: US$387.06k
  • Fred Eppinger (60yo)

    Independent Director

    • Tenure: 13.5yrs
    • Compensation: US$359.56k
  • John Roberts (77yo)

    Independent Director

    • Tenure: 15.6yrs
    • Compensation: US$402.06k
  • Robert Ditmore (84yo)

    Presiding Director

    • Tenure: 0yrs
    • Compensation: US$402.06k
  • Michael Neidorff (76yo)

    Chairman

    • Tenure: 23.4yrs
    • Compensation: US$26.12m
  • Orlando Ayala Lozano (62yo)

    Director

    • Tenure: 8.1yrs
    • Compensation: US$337.06k
  • Alexander McLean (48yo)

    Chairman of University Health Plans

    • Tenure: 15yrs
  • Tommy Thompson (77yo)

    Independent Director

    • Tenure: 14.5yrs
    • Compensation: US$387.06k
  • Dick Gephardt (78yo)

    Independent Director

    • Tenure: 12.8yrs
    • Compensation: US$362.06k
  • Jessica Blume (64yo)

    Director

    • Tenure: 1.7yrs

Company Information

Centene Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Centene Corporation
  • Ticker: CNC
  • Exchange: NYSE
  • Founded: 1984
  • Industry: Managed Health Care
  • Sector: Healthcare
  • Market Cap: US$20.173b
  • Shares outstanding: 413.80m
  • Website: https://www.centene.com

Number of Employees


Location

  • Centene Corporation
  • Centene Plaza
  • 7700 Forsyth Boulevard
  • St. Louis
  • Missouri
  • 63105
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CNCNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 2001
QENDB (Deutsche Boerse AG)YesCommon StockDEEURDec 2001
0HVBLSE (London Stock Exchange)YesCommon StockGBUSDDec 2001
CNC *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNDec 2001

Biography

Centene Corporation operates as a diversified and multi-national healthcare enterprise that provides programs and services to under-insured and uninsured individuals in the United States. The company’s Man ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 23:50
End of Day Share Price2019/10/22 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.