10 Best Dividend Stocks to Buy According to Billionaire Leon Cooperman

2. Cigna Group (NYSE:CI)

Number of Hedge Fund Investors: 61

Billionaire Leon Cooperman’s Stake: $98,299,189

According to data from Yahoo Finance, Cigna Group’s (NYSE:CI) estimate EPS for 2025 is $32.08. Assuming the insurance sector’s P/E ratio is 19 and using Cigna Group’s (NYSE:CI) current stock price of around $338, the stock is looks undervalued. This assumption is also backed by data compiled by Yahoo Finance, which says the average analyst price target set by the Wall Street for Cigna Group (NYSE:CI) is $391. Cigna Group (NYSE:CI) is a giant in the insurance industry, with 200 million total customer relationships.  Over the past 20 years, Cigna Group (NYSE:CI) managed to grow its earnings in 18 years. Wall Street estimates expect Cigna Group (NYSE:CI) to grow 11.97% per annum over the next five years, while its growth this year is expected to hit 13.7%. The stock’s forward P/E ratio is 12.11, much lower than the sector median multiple of 19.70.

Here is what Davis New York Venture Fund has to say about The Cigna Group (NYSE:CI) in its Q3 2023 investor letter:

“In the attractive healthcare sector, we look beyond the obvious to identify businesses that simultaneously have exposure to this growth industry and also trade at low prices. We’re especially drawn to companies like Cigna Group, whose products or services play a part in helping to mitigate healthcare’s constantly rising costs. The healthcare industry has been a growing part of the U.S. economy for decades. As a result, many companies in this sector trade at high valuations reflecting their robust but well-known reputation for growth. For value-conscious investors like us, investing in healthcare requires looking beyond the obvious to identify businesses that have exposure to this growth industry but which trade at low prices. Furthermore, recognizing that the constantly rising cost of healthcare cannot go on forever, we have been particularly drawn to companies whose products or services play some role in managing or reducing the cost of care. As a result, we have positions in Cigna Group, a well-regarded provider of managed care.