Surgery Partners Reports Weak Q4 Results and Cautious 2026 Outlook
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 03 2026
0mins
Source: Benzinga
Surgery Partners' stock fell 12.91% as it crossed below the 5-day SMA, reaching its lowest point in over five years.
The company reported disappointing Q4 results, with adjusted earnings of 12 cents per share, significantly below the consensus estimate of 30 cents. Additionally, revenue forecasts for FY26 were notably lower than anticipated, leading to a 20% decline in stock value. Management's cautious outlook for 2026, projecting net revenue between $3.35 billion and $3.45 billion, reflects ongoing challenges in the market.
These results indicate significant operational pressures and a potential decline in investor confidence, prompting a need for Surgery Partners to adapt its strategies to improve profitability and market competitiveness.
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Analyst Views on SGRY
Wall Street analysts forecast SGRY stock price to rise
11 Analyst Rating
8 Buy
3 Hold
0 Sell
Moderate Buy
Current: 17.000
Low
18.00
Averages
26.30
High
36.00
Current: 17.000
Low
18.00
Averages
26.30
High
36.00
About SGRY
Surgery Partners, Inc. is a healthcare services company. The Company, through its subsidiaries, owns and operates a national network of surgical facilities and ancillary services. The Company operates through the Surgical Facility segment, which includes the operation of ambulatory surgery centers (ASCs), surgical hospitals, anesthesia services, urgent care facilities and multi-specialty physician practices. Its surgical facilities primarily provide non-emergency surgical procedures across many specialties, including, among others, orthopedics and pain management, ophthalmology, gastroenterology (GI) and general surgery. The Company operates a portfolio of approximately 162 surgical facilities comprised of 175 ASCs and 19 surgical hospitals. The Company is focused on surgical services businesses in the United States, with over 200 locations in 30 states, including short-stay surgical hospitals.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Enhanced Financial Flexibility: The transaction was executed by its real estate subsidiary, Standard Bearer Healthcare REIT, which maintains the independence of real estate assets, enhancing financial flexibility and operational control to support long-term growth.
- Return on Investment: Ensign's return on invested capital (ROIC) stands at 8.12%, significantly above the industry average of 3.05%, demonstrating the effectiveness of its acquisition strategy and is expected to further drive profitability.
- Strategic Alignment: This acquisition aligns with Ensign's long-term expansion strategy, leveraging a decentralized operating model to improve care quality and occupancy rates, which is anticipated to create sustained value for shareholders.
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- Optimistic Profit Outlook: Despite slight negative trends in second-quarter outpatient surgery center and nursing data, analysts predict the company will be profitable this year, with net income expected to grow, reflecting recognition of the company's operational capabilities.
- Stock Volatility Analysis: Over the past year, Surgery Partners' shares have experienced 11 moves greater than 5%, and today's increase suggests that the market considers this news significant, although it does not fundamentally alter perceptions of the business.
- Long-term Investment Returns: Although the stock has risen 12.4% year-to-date, the current price of $17.15 is still 28.1% below its 52-week high of $23.84, indicating that investors who bought shares five years ago would have seen a return of only $262.50 on a $1,000 investment.
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- Home Care Growth: Viemed Healthcare specializes in home-based respiratory care, achieving approximately $270.3 million in revenue for FY 2025, a 21% increase, with a net income of $14.9 million, indicating its success in addressing the needs of the aging population and chronic disease patients.
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- Market Outlook Analysis: As insurance companies favor home care to reduce hospital costs, Viemed's revenue surged over 28% year-over-year in Q1 2026, with full-year growth projected at 17%, while Surgery Partners is expected to see only a 3% revenue increase.
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- Financial Structure Comparison: Viemed Healthcare focuses on home-based respiratory care, achieving approximately $270.3 million in FY 2025 revenue, a 21% increase, with a net income of $14.9 million, showcasing its profitability and robust financial structure in a high-demand niche.
- Regulatory Risk Assessment: Surgery Partners faces compliance risks from federal laws, with about $3.7 billion in debt potentially limiting its ability to respond to economic shifts, while Viemed Healthcare's reliance on Medicare reimbursement means policy changes can directly impact its revenue.
- Future Growth Potential: Viemed Healthcare's revenue surged over 28% year-over-year in Q1 2026, with an expected annual growth of 17%, while Surgery Partners anticipates only a 3% revenue increase, highlighting Viemed's strong growth momentum in the home care market.
See More
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- Stable Revenue Performance: In Q1 2026, Surgery Partners reported approximately $811 million in net revenue with a 4.4% year-over-year growth, indicating a gradual recovery and stabilization of operations following pressures experienced at the end of 2025.
- EBITDA and Margin: The adjusted EBITDA for the quarter was $102 million, resulting in an EBITDA margin of 12.6%, aligning with expectations for the seasonally lower first quarter, which reflects progress in cost management and operational efficiency.
- Investment in Surgical Robots: The company operates 73 surgical robots, contributing to a 14.6% year-over-year growth in total joints performed, which not only enhances service capabilities but also strengthens its competitive position in a challenging market.
- Future Outlook and Acquisition Plans: Management reiterated full-year 2026 revenue guidance of $3.35 billion to $3.45 billion while actively pursuing a key acquisition opportunity in a larger surgical hospital market, expected to be announced in mid-2026, demonstrating confidence in future growth prospects.
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Surgery Partners SGRY Q1 2026 Earnings Transcript
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- Market Expansion: Ensign Group completed the acquisition of two nursing facilities in Texas on July 1, 2026, adding 250 licensed beds and expanding its network to 398 healthcare operations, thereby solidifying its position in a rapidly growing market.
- Enhanced Financial Flexibility: The transaction was executed by its real estate subsidiary, Standard Bearer Healthcare REIT, which maintains the independence of real estate assets, enhancing financial flexibility and operational control to support long-term growth.
- Return on Investment: Ensign's return on invested capital (ROIC) stands at 8.12%, significantly above the industry average of 3.05%, demonstrating the effectiveness of its acquisition strategy and is expected to further drive profitability.
- Strategic Alignment: This acquisition aligns with Ensign's long-term expansion strategy, leveraging a decentralized operating model to improve care quality and occupancy rates, which is anticipated to create sustained value for shareholders.
See More
Surgery Partners Stock Rises 2.7% Following Analyst Upgrade
- Analyst Rating Reaffirmed: Cantor Fitzgerald reiterated its 'Overweight' rating on Surgery Partners (SGRY) with an $18.00 price target, leading to a 2.7% increase in stock price during the morning session, indicating market confidence in the company's future prospects.
- Optimistic Profit Outlook: Despite slight negative trends in second-quarter outpatient surgery center and nursing data, analysts predict the company will be profitable this year, with net income expected to grow, reflecting recognition of the company's operational capabilities.
- Stock Volatility Analysis: Over the past year, Surgery Partners' shares have experienced 11 moves greater than 5%, and today's increase suggests that the market considers this news significant, although it does not fundamentally alter perceptions of the business.
- Long-term Investment Returns: Although the stock has risen 12.4% year-to-date, the current price of $17.15 is still 28.1% below its 52-week high of $23.84, indicating that investors who bought shares five years ago would have seen a return of only $262.50 on a $1,000 investment.
See More
Healthcare Shift: Outpatient vs. Home Care Specialists
- Surgical Solutions Network: Surgery Partners operates over 300 surgical centers across 30 states, generating more than $3.3 billion in revenue for FY 2025, a 6% increase despite a net loss of $77.9 million, highlighting its strategic focus on expanding market share.
- Home Care Growth: Viemed Healthcare specializes in home-based respiratory care, achieving approximately $270.3 million in revenue for FY 2025, a 21% increase, with a net income of $14.9 million, indicating its success in addressing the needs of the aging population and chronic disease patients.
- Financial Structure Comparison: Surgery Partners has a debt-to-equity ratio of 2.3x, indicating significant reliance on borrowed funds, while Viemed's ratio is only 0.1x, reflecting a conservative financial structure that aids flexibility during economic fluctuations.
- Market Outlook Analysis: As insurance companies favor home care to reduce hospital costs, Viemed's revenue surged over 28% year-over-year in Q1 2026, with full-year growth projected at 17%, while Surgery Partners is expected to see only a 3% revenue increase.
See More
Investment Comparison: Surgery Partners vs. Viemed Healthcare
- Market Positioning: Surgery Partners operates over 300 surgical centers nationwide, generating over $3.3 billion in FY 2025 revenue, which grew by 6% despite a net loss of $77.9 million, indicating the short-term costs of its expansion strategy.
- Financial Structure Comparison: Viemed Healthcare focuses on home-based respiratory care, achieving approximately $270.3 million in FY 2025 revenue, a 21% increase, with a net income of $14.9 million, showcasing its profitability and robust financial structure in a high-demand niche.
- Regulatory Risk Assessment: Surgery Partners faces compliance risks from federal laws, with about $3.7 billion in debt potentially limiting its ability to respond to economic shifts, while Viemed Healthcare's reliance on Medicare reimbursement means policy changes can directly impact its revenue.
- Future Growth Potential: Viemed Healthcare's revenue surged over 28% year-over-year in Q1 2026, with an expected annual growth of 17%, while Surgery Partners anticipates only a 3% revenue increase, highlighting Viemed's strong growth momentum in the home care market.
See More
Surgery Partners Q1 2026 Earnings Call Insights
- Stable Revenue Performance: In Q1 2026, Surgery Partners reported approximately $811 million in net revenue with a 4.4% year-over-year growth, indicating a gradual recovery and stabilization of operations following pressures experienced at the end of 2025.
- EBITDA and Margin: The adjusted EBITDA for the quarter was $102 million, resulting in an EBITDA margin of 12.6%, aligning with expectations for the seasonally lower first quarter, which reflects progress in cost management and operational efficiency.
- Investment in Surgical Robots: The company operates 73 surgical robots, contributing to a 14.6% year-over-year growth in total joints performed, which not only enhances service capabilities but also strengthens its competitive position in a challenging market.
- Future Outlook and Acquisition Plans: Management reiterated full-year 2026 revenue guidance of $3.35 billion to $3.45 billion while actively pursuing a key acquisition opportunity in a larger surgical hospital market, expected to be announced in mid-2026, demonstrating confidence in future growth prospects.
See More
Surgery Partners SGRY Q1 2026 Earnings Transcript
See More
