AET  Aetna Inc.

Exchange

NYSE

Sector

Health Care

Industry

Hospital And Medical Service Plans

Market Cap.

50.15B

Current Price

$151.19
+0.00 (+0.00%)

Book Price

$99.16
Overvalued by 34.41%
Financial Institution

Company Metrics

  • P/E 46.11
  • P/S 0.80
  • P/B 3.52
  • EPS 3.28
  • Dividend 2.00 / 1.31 %
  • Avg. Vol. 2.40M
  • Shares 331.70M
  • Market Cap. 50.15B

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

Losing Aetna Headquarters May Not Mean Losing Workers
Hartford Courant - Jun 1, 2017
The announcement Wednesday by Aetna Inc. that it's negotiating with other states to move its headquarters out of Hartford is more of a psychological blow than an economic hit, but only if the health insurer's thousands of jobs remain in Connecticut ...
Just what does Aetna want? - Boston Business Journal
Analysts sound off on possible Aetna move from Connecticut - New Haven Register
Medtronic deal with Aetna ties insulin pump payment to patient results
Reuters - Jun 26, 2017
Medtronic Plc said on Monday it signed an agreement with health insurer Aetna Inc under which payment for its insulin pump systems will be tied to how well diabetes patients fare after switching from multiple daily insulin injections.
Aetna Inks New Deal to Improve Healthcare in North Carolina
Zacks.com - Jun 26, 2017
Aetna, Inc. (AET - Free Report) recently inked a deal with Community Care Physician Network, LLC aimed at developing several innovative ways to transform the health care experience in North Carolina.
2 HC Stocks Review-:- Aetna Inc (AET), Novo Nordisk A/S (NVO) - usstockjournal
Aetna: Health information of about 500 Texans was temporarily available online
mySanAntonio.com - Jun 23, 2017
“The information available online generally included first name, last name, Aetna member identification number, provider information, claim payment amount, and in some cases procedure/service codes and dates of service,” the health care benefit company ...
CBO evaluates Senate health bill
Seeking Alpha - Jun 27, 2017
The Senate Republican healthcare bill would result in 22M more people uninsured by the end of the coming decade, while reducing federal spending by $321B during that time, according to the Congressional Budget Office.
Health information of 1708 Aetna clients in Ohio exposed online
cleveland.com - Jun 23, 2017
CLEVELAND, Ohio -- Personal health information for 1,708 Ohio residents who have health insurance through Aetna was exposed online, Aetna Inc. said in a statement Friday. The protected information was "inappropriately available online for a period of ...
These Stock's are Flying High, But Don't Go Contrarian Yet: Aetna Inc. (AET ...
StockNewsJournal - 19 hours ago
Aetna Inc. (NYSE:AET) market capitalization at present is $51.98B at the rate of $151.19 a share. The firm's price-to-sales ratio was noted 0.81 in contrast with an overall industry average of 0.80.
Clues to Identify Price Direction: Aetna Inc. (AET), QUALCOMM Incorporated (QCOM) - AllStockNews
Aetna CEO's goal: Restore credibility between corporate America and public
ModernHealthcare.com - Jun 6, 2017
In 2016, Aetna increased tuition assistance from $3,000 to $5,000 per employee and this year began a program to reimburse student loans $2,000 per year for a lifetime max of up to $10,000 per employee.
Bertolini Letter to Employees Offers Glimpse of a Transformed Aetna
Hartford Courant - Jun 2, 2017
Inc. - in March pledged donations of $50 million over five years to Hartford, giving the city a financial and psychological boost.
Aetna CEO says headquarters move will have 'minimal impact' - FOX 61
TIAA CREF Investment Management LLC Reduces Position in Aetna Inc. (AET)
The Cerbat Gem - 20 hours ago
Aetna logo TIAA CREF Investment Management LLC cut its position in shares of Aetna Inc. (NYSE:AET) by 19.7% during the first quarter, according to its most recent 13F filing with the Securities and Exchange Commission.
The Aetna Inc. (AET) Stake Raised by Empirical Finance LLC - BangaloreWeekly
Aetna Inc. (AET) Receives Consensus Rating of “Buy” from Brokerages - Transcript Daily
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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