5 Best Very Cheap Stocks to Buy Right Now

4. The Cigna Group (NYSE:CI)

Number of Hedge Fund Holders: 76

Insurance company The Cigna Group (NYSE:CI) is one of the very cheap stocks to buy according to both analysts and hedge funds due to the company’s attractive valuation and long-term catalysts. Earlier this month, Raymond James upgraded The Cigna Group (NYSE:CI) to Strong Buy from Outperform. Raymond James kept its price target of $350 for the stock. Raymond James believes The Cigna Group (NYSE:CI) is positioned to have a strong 2023.

Baron Funds made the following comment about Cigna Corporation (NYSE:CI) in its Q4 2022 investor letter:

“We initiated a position in Cigna Corporation (NYSE:CI), a health services organization with two primary segments, Cigna Healthcare and Evernorth. Cigna Healthcare provides health insurance products, including a business in which Cigna provides administrative services only to plan sponsors (employers, unions, and other groups). Evernorth provides a portfolio of health care services, including pharmacy benefit management (PBM) services, care delivery services, data and analytics solutions, and distribution of specialty drugs. Each segment has a portion of business that provides steady, predictable growth. These foundational businesses, which account for roughly 60% of total revenue, include the U.S. commercial business, the PBM business, and international. The other 40% of revenue comes from higher-growth businesses, including the specialty pharmacy business, care delivery services, and Medicare Advantage. Management targets 10% to 13% annual EPS growth over the long term. The stock trades at a significant discount to industry peers because of the company’s commercial health insurance and PBM business mix. We think the PBM business will benefit from the biosimilar wave in the next few years, and as Cigna’s higher growth businesses become a bigger percentage of the overall mix, we think the stock can appreciate at least in line with its annual EPS growth with potential for valuation expansion.”