Surgery Partners (SGRY) AI Stock Analysis

• Market Cap: $1.64B
• Dividend Yield: N/A
• Average Volume (3M): 1.99M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.21
• Revenue Growth: 10.14%
• EPS Growth: -182.12%
• Country: US
• Employees: 15,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Care Facilities
• EPS (TTM): 0.12
• Shares Outstanding: 129,419,830
• 10 Day Avg. Volume: 2,443,790
• 30 Day Avg. Volume: 1,990,377
• PEG Ratio: 0.47
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 0.59
• P/FCF Ratio: 10.05
• Enterprise Value/Market Cap: 3.31
• Enterprise Value/Revenue: 1.64
• Enterprise Value/Gross Profit: 7.09
• Enterprise Value/Ebitda: 5.70
• 1Y Price Target: $20.31
• Price Target Upside: 60.55% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 0.42
• Revenue Forecast (FY): $3.41B

• Rating: 56 Neutral
• Price Target: $13.00 ▲(2.77% Upside)
• Action: Reiterated Date: 03/04/26
• Date: Action: Reiterated 03/04/26

The score is most constrained by weak profitability and mixed cash-flow quality (including the latest free-cash-flow decline) despite strong revenue growth and improving leverage. Technicals also weigh on the rating with the stock below key moving averages. Partially offsetting these are constructive (but cautious) 2026 guidance and strategic actions (portfolio optimization and a new buyback) that could improve earnings efficiency if execution stabilizes.

Positive Factors

Revenue growth and same‑facility expansion

Surgery Partners' sustained top‑line growth and positive same‑facility revenue demonstrates expanding utilization and pricing power across its network. Durable revenue scale supports negotiating leverage with payers, funds continued investment and makes organic growth less dependent on transient market swings.

Operating cash flow improvement

Consistently positive and rising operating cash flow underpins the business' ability to fund capital deployment, service debt and invest in growth initiatives without relying solely on external capital. This cash generation is a durable strength even as free cash flow shows variability.

Physician partnerships and higher‑acuity strategy

The physician‑partner model, active recruitment and investment in robotics indicate a structural shift toward higher‑acuity, higher‑value procedures. This improves long‑term case mix, supports higher margins per case and strengthens referral pipelines across markets.

Negative Factors

Persistent net losses and weak profitability

Ongoing net losses and a recent negative EBITDA period mean the company has not yet converted revenue scale into sustained profitability. This limits retained earnings, depresses returns on equity and increases dependence on operational fixes or structural changes to realize durable margin improvement.

Free cash flow reversal in 2025

A negative FCF year reduces financial flexibility for M&A, de novo openings and capital projects, forcing greater reliance on financing or asset dispositions. If the reversal reflects structural cash‑conversion issues rather than timing, it stresses liquidity and long‑term investment capacity.

Concentrated execution issues & margin pressure

Localized operational failures, higher labor and anesthesia costs and shifting payer mix in key markets caused margin deterioration. If such execution and payer‑mix challenges persist or spread, they threaten scalable margins and the company’s ability to reliably convert revenue into earnings across its footprint.

Surgery Partners Business Overview & Revenue Model

Company Description

Surgery Partners, Inc., through its subsidiaries, owns and operates a network of surgical facilities and ancillary services in the United States. The company operates through two segments, Surgical Facility Services and Ancillary Services. Its surgical facilities comprise ambulatory surgery centers and surgical hospitals that offer non-emergency surgical procedures in various specialties, including gastroenterology, general surgery, ophthalmology, orthopedics, and pain management. The company's surgical hospitals also provide ancillary services, such as diagnostic imaging, pharmacy, laboratory, obstetrics, oncology, physical therapy, and wound care; and ancillary services, which consist of multi-specialty physician practices, urgent care facilities, and anesthesia services. As of December 31, 2021, it owned or operated a portfolio of 126 surgical facilities, including 108 ambulatory surgical centers and 18 surgical hospitals in 31 states. Surgery Partners, Inc. was founded in 2004 and is headquartered in Brentwood, Tennessee.

How the Company Makes Money

Surgery Partners generates revenue primarily by providing surgical and related healthcare services through its owned and operated facilities. The core revenue stream is patient service revenue: the company bills commercial insurers, Medicare, Medicaid, and patients (self-pay) for procedures performed in its ambulatory surgery centers and surgical hospitals, with reimbursement varying by payer contract and procedure mix. In addition to facility fees for the use of operating rooms and recovery services, it earns revenue from ancillary services that may be provided alongside surgery (e.g., diagnostic or other supporting services where offered). A key structural driver of earnings is its physician-partner model: many facilities are operated as joint ventures in which physician groups (and sometimes health systems) hold minority interests, while Surgery Partners typically provides capital, management infrastructure, contracting, revenue-cycle operations, and facility operations; as a result, the company records revenue generated at consolidated facilities and retains the portion of economic returns attributable to its ownership after accounting for noncontrolling interests where applicable. Growth and profitability are influenced by surgical volume, payer mix (commercial vs. government programs), reimbursement rates and contractual terms, staffing and supply costs, and the company’s ability to acquire or develop additional centers and expand service lines within its network. Specific named partnerships or contract terms beyond the general physician/health-system alignment model are null.

Surgery Partners Financial Statement Overview

Summary

Strong revenue momentum and improved leverage are positives, and operating cash flow is consistently positive. However, profitability remains weak with persistent net losses, and the latest period shows negative EBITDA and a reversal to negative free cash flow, which raises execution and cash-conversion risk.

Income Statement

Revenue growth has been strong, accelerating from ~2% (2020) to ~20% (2021) and reaching ~63% in 2025, indicating improving scale and demand. Gross margin has been fairly steady in the low-to-mid 20% range. However, profitability remains the key issue: net income is negative every year provided (even though losses narrowed materially vs. 2024), and 2025 shows negative EBITDA, pointing to potential non-recurring items or cost pressure that undermines operating performance despite higher revenue.

Balance Sheet

Leverage trends improved meaningfully: debt-to-equity moved down from very high levels (~5.8x in 2020 and ~3.0x in 2021) to ~1.5x in 2022–2023, and is shown at ~0.22x in 2025 alongside higher equity. That said, 2024 still reflects elevated leverage (~2.07x), and returns on equity are negative across all periods due to net losses. Overall, the balance sheet looks better than earlier years, but consistency and sustained profitability are still lacking.

Cash Flow

Operating cash flow is consistently positive and generally improving (from ~$87M in 2021 to ~$274M in 2025), which supports underlying cash generation. Free cash flow was solidly positive in 2022–2024 (roughly $78M to $210M), but turned negative in 2025 (about -$79M) with a sharp decline versus the prior year, suggesting higher investment needs or weaker cash conversion. With net income still negative, cash flow quality is mixed—positive operating cash flow is a strength, but the recent free-cash-flow reversal is a notable risk.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.31B	3.11B	2.74B	2.54B	2.23B
Gross Profit	765.00M	745.60M	647.50M	574.90M	491.40M
EBITDA	565.50M	501.40M	446.10M	460.00M	401.00M
Net Income	-77.90M	-168.10M	-11.90M	-54.60M	-70.90M
Balance Sheet
Total Assets	8.24B	7.89B	6.88B	6.68B	6.12B
Cash, Cash Equivalents and Short-Term Investments	239.90M	269.50M	195.90M	282.90M	389.90M
Total Debt	4.02B	3.70B	3.06B	2.93B	3.29B
Total Liabilities	4.72B	4.25B	3.51B	3.40B	3.82B
Stockholders Equity	1.71B	1.79B	1.99B	2.00B	1.09B
Cash Flow
Free Cash Flow	195.60M	209.70M	205.00M	78.20M	29.50M
Operating Cash Flow	274.30M	300.10M	293.80M	158.80M	87.10M
Investing Cash Flow	-246.60M	-488.50M	-225.60M	-307.90M	-331.70M
Financing Cash Flow	-57.30M	262.00M	-155.20M	42.10M	316.30M

Surgery Partners Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SGRY, the sentiment is Negative. The current price of 12.65 is below the 20-day moving average (MA) of 14.27, below the 50-day MA of 14.82, and below the 200-day MA of 19.14, indicating a bearish trend. The MACD of -0.70 indicates Positive momentum. The RSI at 34.92 is Neutral, neither overbought nor oversold. The STOCH value of 9.83 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SGRY.

Surgery Partners Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NHC	78 Outperform	$2.53B	17.67	9.94%	1.80%	23.74%	-18.99%
HCA	75 Outperform	$114.02B	15.88	-140.78%	0.61%	6.82%	15.82%
EHC	70 Outperform	$10.10B	18.84	24.48%	0.65%	11.13%	27.53%
THC	69 Neutral	$18.40B	12.83	34.82%	―	-0.56%	-53.50%
UHS	66 Neutral	$11.82B	9.31	21.03%	0.35%	10.21%	39.58%
SGRY	56 Neutral	$1.64B	-25.23	-4.50%	―	10.14%	-182.12%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Surgery Partners Corporate Events

Surgery Partners Announces Share Buyback and 2026 Outlook

Surgery Partners reported fourth-quarter 2025 revenue of $885.0 million, up 2.4% year over year, with same-facility revenue rising 3.5% but overall surgical cases declining 2.1% as Adjusted EBITDA slipped 4.2% to $156.9 million. For full-year 2025, revenue grew 6.2% to $3.3 billion and Adjusted EBITDA increased 3.5% to $526.2 million, even as the company posted a net loss of $77.9 million, and management cited margin pressure and fourth-quarter underperformance amid strong demand and structural tailwinds for ambulatory surgery centers.

The company ended 2025 with $239.9 million in cash, $692.8 million of revolver capacity and net leverage of roughly 4.3x under its credit agreement, while operating cash flow declined to $274.3 million from $300.1 million a year earlier. On February 26, 2026, the board authorized a share repurchase program of up to $200 million, and management issued initial 2026 guidance targeting at least $530 million of Adjusted EBITDA on revenue between $3.35 billion and $3.45 billion, underscoring a focus on higher-acuity procedures, portfolio optimization and long-term shareholder value despite near-term headwinds.

The most recent analyst rating on (SGRY) stock is a Hold with a $15.50 price target. To see the full list of analyst forecasts on Surgery Partners stock, see the SGRY Stock Forecast page.