AET  Aetna Inc.

Exchange

NYSE

Sector

Health Care

Industry

Hospital And Medical Service Plans

Market Cap.

47.50B

Current Price

$135.07
+1.09 (+0.81%)

Book Price

$98.98
Overvalued by 26.72%
Financial Institution

Company Metrics

  • P/E 21.07
  • P/S 0.75
  • P/B 2.64
  • EPS 6.41
  • Dividend 2.00 / 1.49 %
  • Avg. Vol. 2.73M
  • Shares 351.67M
  • Market Cap. 47.50B

Company Description

Aetna Inc. operates as a diversified health care benefits company in the United States. It offers a range of health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life, and disability plans, as well as medical management capabilities and Medicaid health care management. The company operates in three segments: Health Care, Group Insurance, and... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Aetna Inc (AET) Set to Announce Quarterly Earnings on Tuesday
The Cerbat Gem - 10 hours ago
Aetna Inc (NYSE:AET) will be announcing its earnings results on Tuesday, May 2nd. Aetna has set its FY17 guidance at at least $8.55 EPS.
Aetna Inc (AET) Given Consensus Recommendation of "Buy" by Analysts - Sports Perspectives
Aetna Inc. (AET) Ex-Dividend Date Scheduled for April 11, 2017
Nasdaq - Apr 10, 2017
Aetna Inc. ( AET ) will begin trading ex-dividend on April 11, 2017. A cash dividend payment of $0.5 per share is scheduled to be paid on April 28, 2017.
Zacks: Brokerages Anticipate Aetna Inc (AET) Will Announce Earnings of $2.34 ... - Markets Daily
Aetna Inc. (NYSE:AET) plans to exit Iowa's Obamacare-compliant individual ... - Benchmark Monitor
Will Aetna (AET) Pull a Surprise this Earnings Season?
Yahoo Finance - Apr 28, 2017
During the quarter, the company's deal with Humana Inc. HUM went bust on regulatory concerns. The company's results will continue to suffer from ongoing losses in its Individual Commercial Affordable Care Act-compliant products sold on public exchanges.
Aetna Inc (AET) Short Interest Update
The Cerbat Gem - Apr 26, 2017
Aetna logo Aetna Inc (NYSE:AET) was the recipient of a significant drop in short interest during the month of March. As of March 15th, there was short interest totalling 12,595,089 shares, a drop of 19.8% from the February 28th total of 15,704,758 shares.
Aetna Inc. (AET): From Top to Bottom - StockNewsJournal
Aetna Inc (AET) Stake Reduced by IFC Holdings Incorporated FL - Transcript Daily
Aetna (AET) Up 6.9% Since Earnings Report: Can It Continue?
Yahoo Finance - Apr 19, 2017
It has been about a month since the last earnings report for Aetna Inc. AET. Shares have added about 6.9% in that time frame, outperforming the market.
Aetna Inc. (AET) Moves Lower on Volume Spike for April 21 - Equities.com
Investors Buy Shares of Aetna Inc (AET) on Weakness on Insider Selling - The Cerbat Gem
Today's Brokerage Rating: Aetna Inc. (AET), Brookdale Senior Living Inc. (BKD)
StockNewsJournal - Apr 27, 2017
Aetna Inc. (AET) have shown a high EPS growth of 4.20% in the last 5 years and has earnings decline of -5.50% yoy. Analysts have a mean recommendation of 2.40 on this stock (A rating of less than 2 means buy, “hold” within the 3 range, “sell” within ...
Why to Keeping Eye on Aetna Inc. (AET), Honeywell International Inc. (HON)?
StockNewsJournal - Apr 24, 2017
Investors who are keeping close eye on the stock of Aetna Inc. (NYSE:AET) established that the company was able to keep return on investment at - in the trailing twelve month while Reuters data showed that industry's average stands at 0.02 and sector's ...
Aetna Inc Risk Points versus Health Care
CML News - Apr 19, 2017
This is a scatter plot analysis of the critical risk points from the option market for Aetna Inc (NYSE:AET) compared to its own past and the Health Care ETF.
BRIEF-Aetna Inc's CEO's total compensation for 2016 was $18.7 mln
Reuters - Apr 7, 2017
VALLETTA, April 8 European Union states should continue reforming corporate rules to tackle tax avoidance, EU tax commissioner Pierre Moscovici told finance ministers on Saturday, as some smaller nations urged slower reform to avoid scaring away big ...
Aetna (AET) Hurt by Exchange Business, High Medical Costs
Nasdaq - Apr 13, 2017
The underperformance is likely to have resulted from a number of issues bothering the company of late. Its merger with Humana Inc. HUM was ripped apart recently on regulatory concerns. The deal would have positioned Aetna as a major Medicare provider ...
Aetna Inc (AET) Insider Shawn M. Guertin Sells 29602 Shares - The Cerbat Gem
Aetna Inc (AET) Given Consensus Rating of “Buy” by Analysts - Sports Perspectives
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for AET to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate AET's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

Poor Cash Return on Invested Capital over the past 5 years

AET has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

AET has only created $- of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow - - - - -
divided by
Invested Capital 41.49B 49.87B 53.40B 53.42B 69.15B
Cash ROIC - - - - -

Satisfactory Return on Equity over the past 5 years

AET has generated adequate returns with capital that shareholders have invested. This is sufficient and implies that management performance has been good.

AET has generated $14.24 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 1.66B 1.91B 2.04B 2.39B 2.27B
divided by
Stockholders' Equity 10.41B 14.03B 14.48B 16.11B 17.88B
Return on Equity 15.93% 13.64% 14.09% 14.83% 12.70%

Poor Business Performance over the past 10 years

AET's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

AET has been losing money for the majority of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow - - - - - - - - - -

Low or No Reinvestment of Profits over the past 10 years

AET has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to AET operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 10.14B 9.72B 10.26B 10.40B 10.35B 10.34B 10.56B 11.05B 12.80B 14.72B
Retained Earnings Growth - -4.16% 5.56% 1.42% -0.53% -0.03% 2.04% 4.70% 15.80% 15.00%

Highly Competitive Industry over the past 10 years

It's likely that AET is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely AET invests heavily in R&D and Sales, General & Administrative expenses.

Only $- of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 1.83B 1.38B 1.28B 1.77B 1.99B 1.66B 1.91B 2.04B 2.39B 2.27B
divided by
Revenue - - - - - - - - - -
Net Profit Margin - - - - - - - - - -

Weak Pricing Power over the past 10 years

AET is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that AET has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit - - - - - - - - - -
divided by
Revenue - - - - - - - - - -
Gross Margin - - - - - - - - - -

Low Capital Intensity over the past 10 years

AET has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that AET may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

-% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure - - - - - - - - - -
divided by
Net Income 1.83B 1.38B 1.28B 1.77B 1.99B 1.66B 1.91B 2.04B 2.39B 2.27B
Capital Expenditure Ratio - - - - - - - - - -

Very Strong Dividend History over the past 10 years

AET has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests AET is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 20.00M 18.40M 17.30M 16.10M 167.20M 239.10M 278.70M 320.60M 348.70M 351.00M
divided by
Shares Outstanding 527.67M 489.08M 449.50M 422.90M 380.20M 345.00M 359.20M 359.10M 352.60M 354.30M
Dividend Paid Per Share 0.04 0.04 0.04 0.04 0.44 0.69 0.78 0.89 0.99 0.99
Price at Year End 56.73 28.83 31.61 29.95 42.02 45.56 68.15 90.14 108.93 124.01
Dividend Yield 0.07% 0.13% 0.12% 0.13% 1.05% 1.52% 1.14% 0.99% 0.91% 0.80%

Strong History of Stock Buybacks over the past 10 years

AET has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 527.67M 489.08M 449.50M 422.90M 380.20M 345.00M 359.20M 359.10M 352.60M 354.30M
Stock Bought Back - 7.89% 8.81% 6.29% 11.23% 10.20% -3.95% 0.03% 1.84% -0.48%
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