Latest news with #SGRY
Yahoo
5 days ago
- Business
- Yahoo
SGRY Q1 Earnings Call: Volume Growth and Business Mix Shape Outlook Amid Margin Pressures
Healthcare company Surgery Partners (NASDAQ:SGRY) missed Wall Street's revenue expectations in Q1 CY2025, but sales rose 8.2% year on year to $776 million. Its non-GAAP profit of $0.04 per share was 1.4 cents below analysts' consensus estimates. Is now the time to buy SGRY? Find out in our full research report (it's free). Revenue: $776 million (8.2% year-on-year growth) Adjusted EPS: $0.04 vs analyst estimates of $0.05 ($0.01 miss) Adjusted Operating Income: $89.6 million vs analyst estimates of $64.31 million (11.5% margin, 39.3% beat) EBITDA guidance for the full year is $560 million at the midpoint, in line with analyst expectations Operating Margin: 8%, down from 10.6% in the same quarter last year Sales Volumes rose 4.8% year on year (1.3% in the same quarter last year) Market Capitalization: $2.96 billion Surgery Partners' first quarter results were shaped by higher surgical case volumes and a shift in procedure mix. Management pointed to 6.5% surgical case growth, led by gastrointestinal and musculoskeletal procedures, as the main driver behind revenue gains. CEO Eric Evans credited the company's expanding de novo (new facility) pipeline and robust physician recruitment, particularly in orthopedics, as key contributors to this momentum. However, Evans acknowledged that growth in lower-acuity specialties like GI, which carry lower reimbursement rates, pressured revenue per procedure. CFO David Doherty added that seasonality and calendar effects also influenced the mix and rate dynamics. Management maintained that these trends were anticipated and remain consistent with their internal expectations for the quarter. Looking forward, Surgery Partners' guidance centers on continued surgical volume increases, margin expansion initiatives, and sustained investment in both M&A and de novo facility openings. Management reiterated confidence in achieving its long-term growth algorithm, underpinned by ongoing physician recruitment and integration of recent acquisitions. CEO Eric Evans highlighted, 'We expect same-facility growth at or above the high end of our target, with more balanced volume and rate contributions as the year progresses.' CFO David Doherty cautioned that interest expense would be a headwind in coming quarters due to higher rates, but emphasized the company's strong liquidity and ability to fund growth without raising new debt or equity. Management reported no material supply chain risks from tariffs and minimal exposure to changes in Medicaid reimbursement, supporting the company's outlook for steady performance. Management attributed the quarter's performance to strong organic surgical case growth, strategic physician recruitment, and continued investment in new facilities, while acknowledging margin pressure from business mix and external cost factors. Surgical volume growth: Case growth was driven by higher volumes in gastrointestinal and orthopedic procedures, with total joint surgeries up 22% year-on-year. This reflects targeted investments in facility capabilities and recruitment of specialists. De novo facility expansion: The company's pipeline of newly opened and under-construction facilities is heavily weighted toward higher-acuity specialties like orthopedics. These new sites are expected to deliver long-term growth at a lower capital outlay compared to traditional acquisitions. Physician recruitment impact: Nearly 150 new physicians joined in the quarter, with this cohort bringing in higher-acuity and higher-revenue cases relative to prior years. Management expects this compounding effect to continue as new recruits ramp up their case volumes. Margin pressure from mix: A shift toward lower-acuity GI procedures, which receive lower reimbursement rates, led to lower revenue per case and contributed to a decline in operating margin. Management expects business mix to normalize over the course of the year. Investment in operating efficiency: Ongoing standardization of revenue cycle management and process integration from recent acquisitions are intended to drive future margin improvements. Management cited early benefits from these initiatives, particularly in reducing days sales outstanding and improving cash conversion. Surgery Partners' outlook for the remainder of 2025 is anchored by expectations for continued volume growth, margin recovery, and disciplined capital deployment. Balanced volume and rate growth: Management anticipates a more even contribution from both surgical volume and reimbursement rates as the year progresses, with particular emphasis on ramping newly recruited physicians and de novo facilities. Margin improvement initiatives: The company is pursuing ongoing cost efficiency efforts, including standardized revenue cycle management and operational improvements, to offset prior margin compression. Integration of recent acquisitions is expected to yield further gains. Capital allocation and liquidity: Leadership underlined sufficient liquidity and stable leverage to support targeted M&A and de novo development, without the need for additional debt or equity issuance. However, rising interest expense will be a headwind to free cash flow in the next few quarters. Key areas to monitor in upcoming quarters include (1) the pace at which new de novo facilities and recruited physicians ramp up case volumes, (2) the success of ongoing margin improvement and revenue cycle initiatives, and (3) progress in integrating recent acquisitions to drive incremental earnings. Continued stability in payer mix and the absence of supply chain disruptions will also be important indicators of execution. Surgery Partners currently trades at a forward P/E ratio of 21.3×. At this valuation, is it a buy or sell post earnings? Find out in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-05-2025
- Business
- Yahoo
Barclays Maintains Equal Weight Rating on Surgery Partners (SGRY), Cuts PT
On May 27, Barclays analyst Andrew Mok CFA maintained an Equal Weight rating on Surgery Partners, Inc. (NASDAQ:SGRY) and reduced the price target to $24 from $25. The rating update came after Surgery Partners, Inc. (NASDAQ:SGRY) reported mixed fiscal Q1 2025 results on May 12. The analyst told investors in a research update that while the company's performance for the quarter showed effective physician recruitment and strong demand, factors such as rising unit costs and slower pricing growth demand a cautious approach. A surgeon wearing gloves and a mask, performing a procedure in a well-equipped surgical facility. Surgery Partners, Inc. (NASDAQ:SGRY) added around 150 new physicians to its facilities in fiscal Q1 2025, most of whom management expects to become partners eventually. Revenue for the quarter rose 8.2%, while adjusted EBITDA grew around 7%, supported by strong organic results. This included strong demand and same-facility revenue growth of more than 5%. However, the company missed on earnings expectations in its fiscal Q1 2025 results, with reported EPS of $0.04 falling below the expected $0.08. Net loss attributed to the company in the quarter came up to $37.7 million. These contrasting trends led the analyst to slash the price target for Surgery Partners, Inc. (NASDAQ:SGRY). Surgery Partners, Inc. (NASDAQ:SGRY) is a healthcare services company that provides surgical and related ancillary care solutions. Its operations are divided into the Surgical Facility Services, Ancillary Services, and Optical Services business segments. While we acknowledge the potential of SGRY as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than SGRY and that has 100x upside potential, check out our report about the . READ NEXT: and . Disclosure: None.
Washington Post
12-05-2025
- Business
- Washington Post
Surgery Partners: Q1 Earnings Snapshot
BRENTWOOD, Tenn. — BRENTWOOD, Tenn. — Surgery Partners Inc. (SGRY) on Monday reported a loss of $37.7 million in its first quarter. On a per-share basis, the Brentwood, Tennessee-based company said it had a loss of 30 cents. Earnings, adjusted for non-recurring costs and stock option expense, came to 4 cents per share.
Yahoo
24-04-2025
- Business
- Yahoo
3 Healthcare Stocks with Mounting Challenges
Personal health and wellness is one of the many secular tailwinds for healthcare companies. Despite the rosy long-term prospects, short-term headwinds such as COVID inventory destocking have harmed the industry's returns - over the past six months, healthcare stocks have collectively shed 12.7%. This performance was worse than the S&P 500's 7.5% fall. Investors should tread carefully as the influx of venture capital has also ushered in a new wave of competition. Taking that into account, here are three healthcare stocks best left ignored. Market Cap: $162.9 billion With over 14,000 sales personnel and a portfolio spanning more than 2,500 technology manufacturers, Thermo Fisher Scientific (NYSE:TMO) provides scientific equipment, reagents, consumables, software, and laboratory services to pharmaceutical, biotech, academic, and healthcare customers worldwide. Why Does TMO Fall Short? Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy Day-to-day expenses have swelled relative to revenue over the last five years as its adjusted operating margin fell by 10 percentage points Shrinking returns on capital suggest that increasing competition is eating into the company's profitability At $431 per share, Thermo Fisher trades at 18.2x forward price-to-earnings. Check out our free in-depth research report to learn more about why TMO doesn't pass our bar. Market Cap: $2.69 billion With more than 180 locations across 33 states serving as alternatives to traditional hospital settings, Surgery Partners (NASDAQ:SGRY) operates a national network of outpatient surgical facilities including ambulatory surgery centers and short-stay surgical hospitals. Why Are We Cautious About SGRY? Disappointing unit sales over the past two years indicate demand is soft and that the company may need to revise its strategy 4.2 percentage point decline in its free cash flow margin over the last five years reflects the company's increased investments to defend its market position High net-debt-to-EBITDA ratio of 6× could force the company to raise capital at unfavorable terms if market conditions deteriorate Surgery Partners is trading at $20.91 per share, or 20.4x forward price-to-earnings. If you're considering SGRY for your portfolio, see our FREE research report to learn more. Market Cap: $1.72 billion With a diverse portfolio of eight FDA-approved medications targeting neurological conditions, Supernus Pharmaceuticals (NASDAQ:SUPN) develops and markets treatments for central nervous system disorders including epilepsy, ADHD, Parkinson's disease, and migraine. Why Should You Dump SUPN? Sales stagnated over the last two years and signal the need for new growth strategies Subscale operations are evident in its revenue base of $661.8 million, meaning it has fewer distribution channels than its larger rivals Estimated sales decline of 5.5% for the next 12 months implies an even more challenging demand environment Supernus Pharmaceuticals's stock price of $31.20 implies a valuation ratio of 16x forward price-to-earnings. Read our free research report to see why you should think twice about including SUPN in your portfolio, it's free. Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
