Surgery Partners (NASDAQ:SGRY) Downgraded by Zacks Research to Hold

Key Points

• Zacks Research downgraded Surgery Partners to “Hold” from “Strong Buy,” although the broader analyst consensus remains “Moderate Buy” with an average price target of $19.45.
• Surgery Partners’ latest quarter exceeded expectations, with earnings of $0.10 per share and revenue of $848.9 million, up 2.7% year over year.
• The stock traded down 6% to around $15, while profitability and cash generation weakened; the company reported a wider net loss, lower adjusted EBITDA and elevated net debt of roughly 4.4 times EBITDA.

Surgery Partners (NASDAQ:SGRY - Get Free Report) was downgraded by equities researchers at Zacks Research from a "strong-buy" rating to a "hold" rating in a research note issued to investors on Monday,Zacks.com reports.

Several other equities research analysts have also commented on the stock. Cantor Fitzgerald restated an "overweight" rating and issued a $18.00 price target on shares of Surgery Partners in a report on Tuesday. Raymond James Financial set a $18.00 price objective on shares of Surgery Partners in a report on Tuesday. Benchmark reissued a "buy" rating on shares of Surgery Partners in a research note on Tuesday. TD Cowen upped their target price on Surgery Partners from $17.00 to $19.00 and gave the stock a "buy" rating in a report on Tuesday. Finally, Royal Bank Of Canada dropped their target price on Surgery Partners from $20.00 to $19.00 and set an "outperform" rating on the stock in a research report on Tuesday. Seven investment analysts have rated the stock with a Buy rating, three have given a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat, the company presently has an average rating of "Moderate Buy" and a consensus price target of $19.45.

Surgery Partners Trading Down 6.0%

NASDAQ SGRY opened at $15.00 on Monday. The company's 50-day moving average price is $15.51 and its 200-day moving average price is $14.43. The company has a current ratio of 1.86, a quick ratio of 1.69 and a debt-to-equity ratio of 1.17. The stock has a market cap of $1.96 billion, a PE ratio of -21.43, a PEG ratio of 4.77 and a beta of 1.91. Surgery Partners has a 12 month low of $11.41 and a 12 month high of $24.10.

Surgery Partners (NASDAQ:SGRY - Get Free Report) last released its quarterly earnings data on Monday, August 10th. The company reported $0.10 earnings per share for the quarter, topping analysts' consensus estimates of $0.06 by $0.04. Surgery Partners had a negative net margin of 2.63% and a positive return on equity of 0.87%. The company had revenue of $848.90 million during the quarter, compared to analyst estimates of $830.03 million. During the same period in the prior year, the firm earned $0.17 earnings per share. The firm's revenue for the quarter was up 2.7% compared to the same quarter last year. Equities research analysts forecast that Surgery Partners will post 0.25 earnings per share for the current year.

Institutional Investors Weigh In On Surgery Partners

A number of hedge funds and other institutional investors have recently bought and sold shares of SGRY. PNC Financial Services Group Inc. grew its holdings in Surgery Partners by 239.6% in the first quarter. PNC Financial Services Group Inc. now owns 2,907 shares of the company's stock worth $35,000 after purchasing an additional 2,051 shares during the last quarter. Fifth Third Bancorp increased its position in shares of Surgery Partners by 5,324.0% during the first quarter. Fifth Third Bancorp now owns 4,068 shares of the company's stock worth $48,000 after purchasing an additional 3,993 shares in the last quarter. Caitong International Asset Management Co. Ltd lifted its holdings in shares of Surgery Partners by 45,640.0% during the 3rd quarter. Caitong International Asset Management Co. Ltd now owns 2,287 shares of the company's stock valued at $49,000 after purchasing an additional 2,282 shares during the last quarter. Aquatic Capital Management LLC purchased a new stake in shares of Surgery Partners during the 3rd quarter valued at $121,000. Finally, Alpine Global Management LLC acquired a new stake in shares of Surgery Partners in the 4th quarter worth $175,000.

Key Surgery Partners News

Here are the key news stories impacting Surgery Partners this week:

• Positive Sentiment: Q2 results beat expectations: Adjusted earnings were $0.10 per share versus the $0.06 consensus estimate, while revenue of $848.9 million exceeded the $830.0 million forecast. Revenue increased 2.7% year over year, and same-facility revenue rose 5.0%. Surgery Partners Q2 Earnings and Revenues Beat Estimates
• Positive Sentiment: Full-year guidance was reaffirmed: Surgery Partners continues to expect 2026 revenue of $3.35 billion to $3.45 billion and adjusted EBITDA of at least $530 million, excluding the pending Idaho Falls divestiture. Management said the transaction should improve cash conversion and support deleveraging. Surgery Partners Announces Second Quarter Results
• Positive Sentiment: Analyst support remains favorable: Cantor Fitzgerald reaffirmed its “overweight” rating and set an $18 price target. A separate brokerage consensus target was reported at $21.60, implying substantial potential upside from recent trading levels. Cantor Fitzgerald Reiterates Overweight Rating
• Neutral Sentiment: Broader healthcare stocks could benefit if weak employment data increases expectations for Federal Reserve interest-rate cuts, although this is a sector-wide factor rather than a Surgery Partners-specific catalyst. Likely ETF and Stock Winners From July Jobs Report
• Negative Sentiment: Profitability and cash generation weakened: Q2 net loss attributable to Surgery Partners widened to $15.0 million from $2.5 million a year earlier. Adjusted EBITDA declined to $125.2 million from $129.0 million, while operating cash flow fell to $59.3 million from $81.3 million. Net debt remained elevated at approximately 4.4 times EBITDA. Surgery Partners Reports Second Quarter Results

About Surgery Partners

Surgery Partners, Inc operates as a healthcare services provider specializing in the management and ownership of ambulatory surgery centers, surgical hospitals and multispecialty rehabilitation hospitals across the United States. Through its network of facilities, the company coordinates and delivers a broad range of outpatient surgical procedures in specialties such as orthopedics, ophthalmology, otolaryngology, gastroenterology, pain management and general surgery. Its integrated platform offers ancillary services including on-site imaging, laboratory testing, infusion therapy and physical, occupational and speech rehabilitation.

Since its establishment in 2010 and subsequent public listing in 2015, Surgery Partners has focused on strategic partnerships with physicians and health systems to expand access to cost-effective outpatient care.

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