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 Analysis

Solid track record and good value.


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

Stable Share Price: CNC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.8%

CNC

0.2%

US Healthcare

-1.1%

US Market


1 Year Return

2.3%

CNC

12.4%

US Healthcare

17.9%

US Market

Return vs Industry: CNC underperformed the US Healthcare industry which returned 12.4% over the past year.

Return vs Market: CNC underperformed the US Market which returned 17.9% over the past year.


Shareholder returns

CNCIndustryMarket
7 Day0.8%0.2%-1.1%
30 Day-1.7%2.8%1.4%
90 Day7.1%5.6%6.9%
1 Year2.3%2.3%13.9%12.4%20.3%17.9%
3 Year85.5%85.5%49.6%43.0%47.8%38.3%
5 Year113.1%113.1%61.4%50.3%71.9%53.0%

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 ($65.49) is trading below our estimate of fair value ($144.65)

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 (20.5x) compared to the Healthcare industry average (29.8x).

PE vs Market: CNC is poor value based on its PE Ratio (20.5x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: CNC is good value based on its PB Ratio (2.2x) compared to the US Healthcare industry average (3x).


Next Steps

Future Growth

How is Centene forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

20.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CNC's forecast earnings growth (20.4% per year) is above the savings rate (1.7%).

Earnings vs Market: CNC's earnings (20.4% per year) are forecast to grow faster than the US market (14.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CNC's revenue (12.4% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: CNC's revenue (12.4% 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 (12.1%).


Next Steps

Past Performance

How has Centene performed over the past 5 years?

31.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CNC has high quality earnings.

Growing Profit Margin: CNC's current net profit margins (1.9%) are higher than last year (1.6%).


Past Earnings Growth Analysis

Earnings Trend: CNC's earnings have grown significantly by 31.5% per year over the past 5 years.

Accelerating Growth: CNC's earnings growth over the past year (46.8%) exceeds its 5-year average (31.5% per year).

Earnings vs Industry: CNC earnings growth over the past year (46.8%) exceeded the Healthcare industry 13.9%.


Return on Equity

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


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Centene's financial position?


Financial Position Analysis

Short Term Liabilities: CNC's short term assets ($20.3B) exceed its short term liabilities ($12.9B).

Long Term Liabilities: CNC's short term assets ($20.3B) exceed its long term liabilities ($15.4B).


Debt to Equity History and Analysis

Debt Level: CNC's debt to equity ratio (107.3%) is considered high.

Reducing Debt: CNC's debt to equity ratio has increased from 46.6% to 107.3% over the past 5 years.

Debt Coverage: CNC's debt is not well covered by operating cash flow (10.9%).

Interest Coverage: CNC's interest payments on its debt are well covered by EBIT (6.2x 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 1.5x 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%industryaverage1.4%forecastin3Years0%

Current dividend yield vs market & industry

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.


Stability and Growth of Payments

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

How experienced are the management team and are they aligned to shareholders interests?

3.9yrs

Average management tenure


CEO

Michael Neidorff (76yo)

23.8yrs

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 ($USD26.12M) is above average for companies of similar size in the US market ($USD10.81M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Michael Neidorff
Chairman23.8yrsUS$26.12m1.11% $428.3m
Jeffrey Schwaneke
Executive VP3.9yrsUS$9.96m0.031% $12.0m
Brandy Burkhalter
Executive VP & COO0yrsUS$7.57m0.024% $9.1m
Mark Brooks
Executive VP & Chief Information Officer3.8yrsUS$4.04m0.0095% $3.6m
Jesse Hunter
Executive VP & Chief Strategy Officer7.2yrsUS$6.16m0.060% $23.0m
Christopher Isaak
Senior VP3.8yrsno data0.0032% $1.2m
Edmund Kroll
Senior Vice President of Finance & Investor Relations12.8yrsno datano data
Christopher Koster
Senior Vice President0yrsno data0.017% $6.6m
Matthew Snyder
Senior Vice President of Internal Audit1.2yrsno datano data
Shannon Bagley
Senior Vice President of Human Resources0yrsno datano data

3.9yrs

Average Tenure

50.5yo

Average Age

Experienced Management: CNC's management team is considered experienced (3.9 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Michael Neidorff
Chairman23.8yrsUS$26.12m1.11% $428.3m
David Steward
Independent Director16.8yrsUS$387.06k0.0010% $392.0k
Frederick Eppinger
Independent Director13.8yrsUS$359.56k0.026% $10.2m
John Roberts
Independent Director15.9yrsUS$402.06k0.033% $12.9m
Robert Ditmore
Presiding Director0yrsUS$402.06k0.15% $56.1m
Orlando Ayala Lozano
Independent Director8.4yrsUS$337.06k0.031% $11.8m
Alexander McLean
Chairman of University Health Plans15.3yrsno datano data
Thomas Thompson
Independent Director14.8yrsUS$387.06k0.032% $12.3m
Richard Gephardt
Independent Director13.2yrsUS$362.06k0.011% $4.3m
Jessica Blume
Director2yrsUS$697.95k0.0017% $653.3k

14.8yrs

Average Tenure

71.5yo

Average Age

Experienced Board: CNC's board of directors are seasoned and experienced ( 14.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CNC insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 6%.


Top Shareholders

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$38.427b
  • Shares outstanding: 586.77m
  • 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
QENETLX (Eurotlx)YesCommon StockITEURDec 2001
C1NC34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COMBRBRLDec 2019

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 Managed Care segment offers health plan coverage to individuals through government subsidized programs, including Medicaid, the State children’s health insurance program, long-term services and support, foster care, and medicare-medicaid plans, which covers dually eligible individuals, as well as aged, blind, or disabled programs. Its health plans include primary and specialty physician care, inpatient and outpatient hospital care, emergency and urgent care, prenatal care, laboratory and X-ray, home-based primary care, transportation assistance, vision care, dental care, telehealth, immunization, specialty pharmacy, therapy, social work, nurse advisory, and care coordination services, as well as prescriptions, limited over-the-counter drugs, medical equipment, and behavioral health and abuse services. This segment also offers various individual, small group, and large group commercial healthcare products to employers and directly to members in the Managed Care segment. Its Specialty Services segment provides pharmacy benefits management services; health, triage, wellness, and disease management services; and vision and dental, and management services, as well as care management software that automate the clinical, administrative, and technical components of care management programs. This segment offers its services and products to state programs, correctional facilities, healthcare organizations, employer groups, and other commercial organizations. The company provides its services through primary and specialty care physicians, hospitals, and ancillary providers. Centene Corporation was founded in 1984 and is headquartered in St. Louis, Missouri. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 01:06
End of Day Share Price2020/02/21 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.