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Surgery Partners, Inc. (NASDAQ:SGRY) received a reiterated Sector Weight rating from KeyBanc analysts, as they maintained their stance on the company’s shares. The assessment came after the healthcare services provider posted its fourth-quarter results, which showed a solid performance with same-store revenue growth of 5.6%, slightly above KeyBanc’s projection of 5.0%, and EBITDA figures that were roughly in line with expectations.
Looking ahead, Surgery Partners provided an EBITDA outlook for 2025 that surrounded the current market consensus, excluding any impact from divestitures. Management also presented a compelling argument that the company is shielded from significant policy uncertainties, particularly those pertaining to Site-Neutral reforms and Medicaid payments. InvestingPro analysis indicates that net income is expected to grow this year, with analysts predicting a return to profitability in 2025.
The ongoing proposal from Bain Capital to purchase Surgery Partners remains a central near-term focus for the company’s stock. The private equity firm’s nonbinding offer to acquire all outstanding shares of Surgery Partners stands at $25.75 per share, representing a premium to the current trading price of $23.86. With a market capitalization of $3.04 billion, KeyBanc’s commentary highlighted that while they are not in favor of growth-oriented companies like Surgery Partners leaving the public market, they anticipate that Bain Capital’s proposal is likely to be accepted at the offered price.
This development comes amidst a broader context where private equity firms have shown increased interest in healthcare companies, with several transactions taking place in the sector. The potential acquisition by Bain Capital underscores the attractiveness of Surgery Partners as an investment, especially given the company’s performance and management’s confidence in its financial outlook.
Investors and market watchers will continue to monitor the situation closely, as the acceptance of Bain Capital’s offer could lead to significant changes for Surgery Partners, including its transition from a publicly traded entity to a privately held one.
In other recent news, Surgery Partners Inc . reported its fourth-quarter 2024 earnings, surpassing analyst expectations with an earnings per share (EPS) of $0.44, compared to the forecasted $0.39. The company also exceeded revenue forecasts, reporting $864.4 million against an anticipated $827.9 million. Full-year revenue surpassed $3 billion for the first time, with adjusted EBITDA reaching over $500 million. Looking ahead, Surgery Partners projects 2025 net revenue between $3.3 billion and $3.45 billion, with adjusted EBITDA expected to range from $555 million to $565 million. UBS analysts recently adjusted their financial outlook for Surgery Partners, reducing the stock’s price target to $34 from $38 while maintaining a Buy rating. The revision reflects the company’s strategic divestitures and updated 2025 guidance. UBS’s adjusted EBITDA estimates for 2025 and 2026 have been slightly reduced, accounting for the company’s recent strategic actions. Despite these adjustments, UBS’s maintained Buy rating indicates a positive outlook for Surgery Partners.
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