Rise in membership boosts Cigna’s net income

Cigna Corp. on Wednesday reported a 15% increase in third-quarter profit, buoyed by a strong showing in its health insurance business as membership rolls increased and the company better managed its medical costs.

In the quarter, net income rose to $298 million, or $2.75 a share, from $259 million, or $2, during the same period last year.

Earnings excluding investment gains and other nonoperating items increased to $268 million, or $2.48 a share, in the latest quarter from $251 million, or $1.94, last year.

Analysts polled by Thomson Financial were looking for earnings, excluding items, of $2.17 a share. Revenue climbed 3% to $4.14 billion, missing analysts’ median expectation of $4.2 billion.

Cigna has been betting heavily on plans that give customers more control over how their healthcare dollars are spent. Cigna and other insurers believe the concept is key to reining in increases in healthcare costs. In the quarter, Cigna had 9.3 million medical members, up from a little more than 9 million in the second quarter and 9.1 million a year earlier.

Cigna’s shares rose $1.99, or 1.7%, to $118.97.

MasterCard’s profit up 82%; shares surge 15%

MasterCard Inc. said third-quarter profit climbed 82%, reflecting increased revenue and a higher number of purchases worldwide. Its shares climbed nearly 15% on Wednesday, surging $10.97 to $85.07.

It was its first full quarter as a publicly traded company.

MasterCard sold stock to the public for the first time in May. Larger rival Visa USA has since announced that it too will go public.

Purchase, N.Y.-based MasterCard said it earned $193 million, or $1.42 a share, for the three months ended Sept. 30 versus $106.1 million, or the equivalent of 79 cents a share, a year earlier when MasterCard was a private entity owned by the nation’s largest banks.

Excluding special items from the third quarter last year, net income was up 38.8%. Those items included costs from settling litigation and a cash-based executive compensation plan.

Revenue rose 13.9% to $902 million.

Profit drops in quarter

at Prudential Financial

Life insurance and investment giant Prudential Financial Inc. reported that third-quarter profit slumped from a year earlier, but it beat Wall Street estimates and raised annual guidance.

Quarterly financial services profit was $1.15 billion, or $2.38 a share, compared with $1.32 billion, or $2.59, for the same period in 2005.

Revenue for the three months that ended Sept. 30 rose 2% to $6.11 billion.

Shares of Prudential fell 61 cents to $76.32.