Cigna (CI) Buys Brighter To Enhance Technology Investment

Cigna Corp. (NYSE:CI) has acquired Brighter Inc., a healthcare software company.

The deal is an extension of the agreement existent between the two companies for the past couple of years now. Brighter will develop Cigna’s mobile and desktop platforms and create new end-to-end experiences. This is primarily aimed at providing a comprehensive support to its customers to better manage their health and providing high-quality care at minimum costs.

Cigna remains quite active in pushing the boundaries with technological innovations. Recently it updated its MyCigna app and the Cigna.com website, terming the same as One Guide personalized health benefits and wellness program.

Notably, a growing emphasis on the use of information technology to simplify, automate and increase efficiency in operations and data management has prompted healthcare providers and payers to step up their digital transformation game.

Insurers have taken great strides in the recent years to make tech investments. More and more players are partnering with tech companies to solve customer, operational and business-model issues.

Such a deal was very much anticipated with management giving out cues at its recent investor conference that growth will be accelerated via capital deployment in multiple avenues. For instance, strategic mergers and acquisition and the recent deal uniquely fits the bill here.

The company is aggressively trying to expand inorganically across all verticals. Recently, it bought Zurich Insurance Middle East, which will lend it a stronger foothold in the Gulf countries of UAE, Lebanon, Kuwait and Oman. This contract has raised optimism among the company’s investors about its endeavors to diversify operations outside the U.S. markets that are faced with stiff competition and stringent regulations.

So far this year, the stock has soared a whopping 53%, significantly outperforming the industry’s growth of 14%.

Cigna carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Investors interested in the same space can consider some better-ranked stocks like Triple-S Management Corporation (NYSE:GTS) , Wellcare Health Plans Inc (NYSE:WCG) and Magellan Health, Inc. (NASDAQ:MGLN) , each sporting a Zacks Rank #1.

Triple-S Management delivered positive surprises in two of the last four quarters with an average beat of 74%.

Wellcare Health came up with positive surprises in each of the last four quarters with an average beat of 64.3%.

Magellan Health pulled off positive surprises in three of the last four quarters with an average beat of 0.9%.

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