Goldman Sachs Upgrades CIGNA (CI) to Buy, UnitedHealth Group (UNH) Downgraded to Neutral

Goldman Sachs upgraded CIGNA (NYSE: CI) from Neutral to Buy with a price target of $117.00. UnitedHealth Group (NYSE: UNH) was downgraded to Neutral. Analyst Matthew Borsch is more defensive on underwriting risk for 2015 and swapped the two stocks.

"Among the factors, less than 25% of CI’s earnings are underwriting risk based (vs. 50%+ for the other ‘Big 5’: i.e., UNH, AET, ATHM, and HUM). Moreover, CI’s valuation discount to the sector is now at a trough level for the past 5 years, reflecting that the stock lagged in 2014 relative to the group (CI +18% vs. other Big 5 +29%) but that valuation gap has historically narrowed during past periods of utilization trend pressure. To be clear, we think UNH remains very well positioned to benefit from the sector growth trends, but see better risk/reward in CI for 2015," said Borsch.

For an analyst ratings summary and ratings history on CIGNA click here. For more ratings news on CIGNA click here.

Shares of CIGNA closed at $101.46 yesterday.

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