The Zacks Analyst Blog Highlights: CIGNA, IntercontinentalExchange, NYSE Euronext, CME Group and Moody's

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Oct 16, 2013, 09:37 ET

CHICAGO, Oct. 16, 2013 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the CIGNA Corp. (NYSE:CI-Free Report), IntercontinentalExchange Inc. (NYSE:ICE-Free Report), NYSE Euronext Inc. (NYSE:NYX-Free Report), CME Group Inc. (Nasdaq:CME-Free Report) and Moody's Corp. (NYSE:MCO-Free Report).

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Here are highlights from Tuesday's Analyst Blog:

Cigna Expands ACO Initiative

U.S. health insurer CIGNA Corp. (NYSE:CI-Free Report) has started Collaborative Accountable Care initiative with Santa Clara County IPA (SCCIPA).

SCCIPA is the largest individual practice association in Santa Clara County with 850 physicians in more than 60 specialties.

The program was effective from Oct 1, 2013. Approximately 13,000 Cigna customers who are covered by Cigna PPO health plan and receive care from SCCIPA's 850 primary care doctors and specialists will stand to gain from the initiative.

This step is in sync with Cigna's goal to improve the quality of care and service provided to their customers along with lowering healthcare costs and improving overall value.

Cigna's Collaborative Accountable Care initiative is similar to an Accountable Care Organization (ACO). An ACO is a group effort by health care providers, who voluntarily form alliances to provide coordinated high quality care to patients.

An ACO is accountable for the quality, cost and overall care offered to members. By focusing on the needs of patients and connecting payments to the service offered this model intends to improve the health of individuals and communities as well as help to curtail rising healthcare costs.

Through this program doctors will monitor and coordinate all the aspects of a patient's care. The patients will get the benefits of the program even as they retain their current physician. The program does not specify any changes regarding referrals to specialists. Patients suffering from long-term diseases such as diabetes, heart disease and obesity are the ones who will benefit the most from the initiative.

The enrollees in the program will have the additional benefit of receiving services of registered nurses. They will coordinate patient care, educate patients about various health conditions, and counsel them on proper health care.

Cigna's ACO will also designate care coordinators to work closely with patients and monitor the services being offered. They will follow up with the patient throughout, sending reminders about screenings required or recommend direct medical help. At the same time, they will educate patients by helping them participate in various health and wellness programs and workshops.

NYSE-ICE Merger to Close November 4

Shares of IntercontinentalExchange Inc. (NYSE:ICE-Free Report) have been on an uptrend since ICE and NYSE Euronext Inc. (NYSE:NYX-Free Report) jointly declared that they have set the closing date for the acquisition of NYSE Euronext by ICE for Nov 4, 2013. Shares of ICE shored up 1.3% to $195.66 on Oct 14. The deal is subject to the remaining approvals from the European regulators and might be extended if any necessary approvals remain pending on that date.

The transaction was first announced on Dec 20, 2012, whereby IntercontinentalExchange had decided to acquire NYSE Euronext for a purchase consideration of $8.2 billion or $33.12 per share. Of the entire $8.2 billion, 67% or approximately $5.5 billion is in shares and the remaining 33% or nearly $2.7 billion is in cash. The deal was scheduled to culminate in the first half of 2013 and had been pending approval on many fronts.

The deal was being scrutinized by the European Union Comission (EUC), particularly, in terms of the effect of the merger on agricultural and soft commodity derivatives along with U.S. equity derivatives. In Jun 2013, the deal received a green signal from the EUC, making the NYSE Euronext-IntercontinentalExchange merger the third largest global exchange after the Hong Kong Exchanges and Clearing and CME Group Inc. (Nasdaq:CME-Free Report). Later, in Jul 2013, 43 member firms and 75 million contract sides of NYSE Euronext were transferred to ICE Clear Europe, a wholly owned subsidiary of IntercontinentalExchange.

Earlier this month, IntercontinentalExchange issued long-term notes worth $1.4 billion to finance the aforementioned deal. The first set comprised $600 million worth of notes at an interest rate of 2.5%. These notes are slated to mature in 2018. The remaining $800 million worth of notes bore an interest rate of 4.0% and are due to mature in 2023. Both the 5-year and 10-year notes, along with IntercontinentalExchange's $1.8 billion of revolving credit facility and $1.0 billion cash, will be used to fund the cash component of NYSE acquisition. Concurrently, Moody's Investor Service, the credit rating agency of Moody's Corp. (NYSE:MCO-Free Report) assigned an "A3" rating on the senior debt of the holding company of IntercontinentalExchange, with a stable outlook.

IntercontinentalExchange carries a Zacks Rank #3 (Hold).

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