Cigna Group (CI) shows greater stability as its managed care organization peers face policy headwinds in their government books, RBC Capital Markets said in a Thursday note.

"As MCO peers wrestle with policy uncertainty and rate shortfalls in government books, CI benefits from a comparatively more stable foundation," the report said.

Noting Cigna's recent Q4 results, RBC said investors have pointed to higher-than-expected cost trend in the quarter with medical care ratio of 88% exceeding RBC and consensus estimates by 60 basis points and 40 basis points, respectively.

Regarding Evernorth, the company's health services division, RBC said it was pleased to see management continue to lean into its "high-growth specialty" platform, most recently through its Shields Health Solutions investment.

Despite the mixed feedback on Q4 print, RBC kept its outperform rating while cutting its price target to $333 from $344.

"Our target multiple reflects favorable business mix increasingly weighted towards specialty drug capabilities and the absence of exposure to government headwinds weighing on peers," it said.

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