Cigna CEO on Express Scripts deal: 'We're proving the combination works'

• "We're proving the combination works. We're growing the company, as you noted," Cigna CEO David Cordani said of the company's $54 billion merger with Express Scripts in 2018.
• "We increased our revenue guidance and our earnings guidance each of the last quarters of 2019 and we ended the year with another beat," he said in a "Mad Money" interview.
• "Then we're stepping into 2020 with a 10% revenue growth outlook and another double-digit earnings outlook in front of us," he said.

Cigna CEO David Cordani on Thursday took a victory lap more than a year after the health services group executed a controversial takeover of prescription manager Express Scripts.

"We're proving the combination works. We're growing the company, as you noted," he told CNBC's Jim Cramer in a "Mad Money" interview. "We increased our revenue guidance and our earnings guidance each of the last quarters of 2019 and we ended the year with another beat."

When the acquisition was first announced in early 2018, Cigna shareholders disapproved of the deal, and the stock sold off more than 11% — its worst single-day decline in the past decade, according to FactSet. Ahead of the shareholder vote approving the deal later that year, investor Carl Icahn slammed the move, saying it gave Express Scripts a "ridiculous valuation" and could "rival the worst acquisitions in corporate history."

The addition of Express Scripts gave Cigna a chance to compete directly with CVS, which bought Aetna for $69 billion that year, and UnitedHealth Group's Optum pharmacy benefits arm.

Since the $54 billion deal closed in December 2018, the stock slipped below $145 per share in April and has since gained more than 45% to $211.86 as of Wednesday's close. The stock is now less than $15 away from its all-time closing high. Cordani all but declared that he is confident the share price could climb to new highs this year.

"Then we're stepping into 2020 with a 10% revenue growth outlook and another double-digit earnings outlook in front of us," Cordani said in the interview. "And importantly, Jim, we're producing a phenomenal amount of free operating cash flow."

Cigna released its better-than-expected fourth-quarter earnings report before the market opened. The health insurer brought in $36.5 billion of revenue and $977 million of profit, or $2.60 per share. For the full year, Cigna had $140.2 billion in sales and $13.44 in earnings per share, up from $48.7 billion and $10.54, respectively, the year prior, according to FactSet.

The company's 2020 revenue guidance came in between $154 billion and $156 billion, which beat FactSet estimates of $150 billion.

Disclosure: Cramer's charitable trust owns shares of CVS.

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