Surgery Partners (NASDAQ:SGRY) Shares Gap Up After Better-Than-Expected Earnings

Key Points

• Surgery Partners beat quarterly expectations: EPS came in at $0.10 versus the $0.06 consensus, while revenue reached $848.90 million, above estimates of $830.03 million. Revenue increased 2.7% year over year, although the company posted a negative 2.28% net margin.
• Shares initially jumped on the results, opening at $16.46 after closing at $15.53, before last trading near $15.91.
• Analyst sentiment remains broadly positive, with a consensus rating of “Moderate Buy” and an average price target of $21.60; several institutional investors also increased their holdings.

Surgery Partners, Inc. (NASDAQ:SGRY - Get Free Report) shares gapped up before the market opened on Monday after the company announced better than expected quarterly earnings. The stock had previously closed at $15.53, but opened at $16.46. Surgery Partners shares last traded at $15.9050, with a volume of 173,693 shares changing hands.

The company reported $0.10 EPS for the quarter, beating analysts' consensus estimates of $0.06 by $0.04. The business had revenue of $848.90 million for the quarter, compared to analysts' expectations of $830.03 million. Surgery Partners had a negative net margin of 2.28% and a positive return on equity of 1.04%. The business's quarterly revenue was up 2.7% on a year-over-year basis. During the same period last year, the business earned $0.17 earnings per share.

Analyst Upgrades and Downgrades

A number of brokerages recently commented on SGRY. Weiss Ratings reiterated a "sell (e+)" rating on shares of Surgery Partners in a research report on Tuesday, May 26th. Zacks Research upgraded shares of Surgery Partners from a "hold" rating to a "strong-buy" rating in a research report on Thursday, June 4th. Finally, Jefferies Financial Group reaffirmed a "buy" rating and set a $17.00 price objective on shares of Surgery Partners in a research note on Wednesday, May 6th. One research analyst has rated the stock with a Strong Buy rating, seven have issued a Buy rating, two have given a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the company currently has an average rating of "Moderate Buy" and a consensus price target of $21.60.

Institutional Trading of Surgery Partners

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the business. UBS Group AG boosted its position in Surgery Partners by 111.4% during the 4th quarter. UBS Group AG now owns 7,803,974 shares of the company's stock valued at $120,571,000 after acquiring an additional 4,113,052 shares in the last quarter. Hsbc Holdings PLC raised its position in shares of Surgery Partners by 104.2% in the 4th quarter. Hsbc Holdings PLC now owns 1,931,577 shares of the company's stock worth $30,151,000 after acquiring an additional 985,748 shares in the last quarter. Dimensional Fund Advisors LP lifted its stake in shares of Surgery Partners by 7.9% in the 1st quarter. Dimensional Fund Advisors LP now owns 5,296,411 shares of the company's stock valued at $63,131,000 after purchasing an additional 389,831 shares during the period. Clearline Capital LP purchased a new position in shares of Surgery Partners in the 4th quarter valued at approximately $3,088,000. Finally, Irenic Capital Management LP boosted its position in shares of Surgery Partners by 740.2% during the first quarter. Irenic Capital Management LP now owns 711,000 shares of the company's stock valued at $8,475,000 after purchasing an additional 626,380 shares in the last quarter.

Surgery Partners Stock Down 0.5%

The company has a market capitalization of $2.02 billion, a P/E ratio of -25.67, a price-to-earnings-growth ratio of 4.64 and a beta of 1.92. The company has a 50-day moving average of $15.43 and a two-hundred day moving average of $14.43. The company has a quick ratio of 1.69, a current ratio of 1.86 and a debt-to-equity ratio of 1.17.

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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