Surgery Partners (NASDAQ:SGRY) Posts Quarterly Earnings Results, Beats Expectations By $0.12 EPS

Key Points

• Surgery Partners reported adjusted EPS of ($0.03), beating consensus by $0.12, with roughly $811 million of net revenue (4.4% same‑facility growth) and about $102 million of adjusted EBITDA, and the company reiterated full‑year revenue and adjusted EBITDA guidance.
• Operational momentum remains strong: ASC total joints grew 14.6% year‑over‑year, the platform now includes 73 surgical robots, and ~140 physicians were recruited in Q1 to support higher‑acuity and MSK expansion.
• Near‑term margin headwinds include reinstated incentive compensation, new provider taxes/tariffs (~$8 million) and higher interest expense (~$7 million), even as the board approved a $200 million share buyback and the company pursues gradual deleveraging (net leverage ~4.3x).

Surgery Partners (NASDAQ:SGRY - Get Free Report) announced its quarterly earnings results on Tuesday. The company reported ($0.03) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.15) by $0.12, FiscalAI reports. Surgery Partners had a positive return on equity of 1.28% and a negative net margin of 2.35%.During the same quarter in the prior year, the business posted $0.04 earnings per share. The firm's revenue was up 4.5% on a year-over-year basis.

Here are the key takeaways from Surgery Partners' conference call:

• First-quarter results were broadly in line or modestly ahead of expectations with ~$811 million of net revenue, 4.4% same‑facility revenue growth and ~$102 million of adjusted EBITDA, and the company reiterated full‑year revenue and adjusted EBITDA guidance.
• Organic growth drivers showed strength—total joints in ASCs grew 14.6% year‑over‑year, the platform has 73 surgical robots supporting higher‑acuity work, ~140 physicians were recruited in Q1, and de novo development remains an active, MSK‑focused growth channel.
• Margins faced identifiable headwinds from reinstated incentive compensation, new provider taxes and tariff pressures (management estimates ~$8 million of combined FY pressure), plus higher interest expense (~$7 million) due to an expired interest rate swap, weighing on near‑term EBITDA.
• Capital deployment was modest in Q1 (~$4 million), but the company expects ~$200 million of annual deployment when active, is pursuing portfolio optimization (in advanced talks on a larger surgical hospital market with a possible mid‑2026 announcement) and remains focused on gradual deleveraging (net leverage ~4.3x under the credit agreement).

Surgery Partners Price Performance

Shares of NASDAQ SGRY traded up $0.30 during mid-day trading on Tuesday, reaching $14.50. The company had a trading volume of 635,752 shares, compared to its average volume of 1,514,941. The company has a debt-to-equity ratio of 1.15, a quick ratio of 1.71 and a current ratio of 1.87. Surgery Partners has a one year low of $11.41 and a one year high of $24.18. The firm has a market cap of $1.90 billion, a price-to-earnings ratio of -23.36 and a beta of 1.99. The business's 50-day simple moving average is $13.39 and its 200 day simple moving average is $15.65.

Surgery Partners declared that its Board of Directors has approved a share buyback program on Thursday, February 26th that authorizes the company to repurchase $200.00 million in outstanding shares. This repurchase authorization authorizes the company to buy up to 9.7% of its stock through open market purchases. Stock repurchase programs are usually a sign that the company's board believes its shares are undervalued.

Insider Buying and Selling

In related news, insider Danielle Burkhalter sold 7,736 shares of the firm's stock in a transaction on Friday, March 6th. The stock was sold at an average price of $13.60, for a total value of $105,209.60. Following the transaction, the insider owned 37,103 shares in the company, valued at approximately $504,600.80. This trade represents a 17.25% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, insider Marissa Brittenham sold 8,785 shares of the firm's stock in a transaction on Friday, March 6th. The stock was sold at an average price of $13.70, for a total value of $120,354.50. Following the completion of the transaction, the insider owned 54,623 shares in the company, valued at $748,335.10. The trade was a 13.85% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 96,896 shares of company stock valued at $1,284,058 in the last ninety days. Insiders own 2.70% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently modified their holdings of SGRY. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. increased its position in shares of Surgery Partners by 4.6% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 45,693 shares of the company's stock worth $1,085,000 after purchasing an additional 2,015 shares during the period. Millennium Management LLC boosted its stake in Surgery Partners by 1,253.7% in the first quarter. Millennium Management LLC now owns 202,274 shares of the company's stock valued at $4,804,000 after buying an additional 219,806 shares in the last quarter. Empowered Funds LLC boosted its stake in Surgery Partners by 11.0% in the first quarter. Empowered Funds LLC now owns 12,853 shares of the company's stock valued at $305,000 after buying an additional 1,278 shares in the last quarter. Prudential Financial Inc. acquired a new stake in Surgery Partners in the second quarter valued at about $219,000. Finally, Invesco Ltd. boosted its stake in Surgery Partners by 7.4% in the second quarter. Invesco Ltd. now owns 1,683,311 shares of the company's stock valued at $37,420,000 after buying an additional 115,627 shares in the last quarter.

Analysts Set New Price Targets

Several equities research analysts have issued reports on SGRY shares. Royal Bank Of Canada cut their price target on Surgery Partners from $31.00 to $20.00 and set an "outperform" rating for the company in a report on Wednesday, March 4th. Barclays cut their price target on Surgery Partners from $18.00 to $14.00 and set an "equal weight" rating for the company in a report on Tuesday, March 3rd. TD Cowen cut their price target on Surgery Partners from $28.00 to $20.00 and set a "buy" rating for the company in a report on Thursday, March 5th. Mizuho cut their price target on Surgery Partners from $19.00 to $17.00 and set an "outperform" rating for the company in a report on Thursday, March 5th. Finally, Cantor Fitzgerald reaffirmed an "overweight" rating on shares of Surgery Partners in a report on Wednesday, March 4th. Eight analysts have rated the stock with a Buy rating, two have assigned a Hold rating and two have issued a Sell rating to the company's stock. According to MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of $22.00.

Surgery Partners Company Profile

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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