Key earnings takeaways for Surgery Partners (SGRY)

Surgery Partners (SGRY) kicked off 2026 with first quarter results that paired revenue growth with a narrower loss, while management reaffirmed full year guidance and highlighted ongoing cost discipline and portfolio work.

The company reported Q1 revenue of US$810.9 million, basic and diluted loss per share from continuing operations of US$0.28, and an overall net loss of US$35.9 million. Management reiterated full year 2026 revenue guidance of US$3.35b to US$3.45b, alongside a focus on physician recruitment and expanding higher acuity services.

Following the earnings beat and reaffirmed 2026 guidance, Surgery Partners' recent momentum has turned more positive, with an 11.9% 1 month share price return and a 7.1% 3 month share price return. However, the 1 year total shareholder return of 34.8% and 5 year total shareholder return of 72.3% remain deeply negative.

If these results have you rethinking where healthcare fits in your portfolio, it could be worth scanning for other opportunities across 35 healthcare AI stocks.

With Surgery Partners trading at US$14.44 and sitting at a discount to both analyst targets and some intrinsic value estimates, you have to ask: is this a mispriced healthcare operator, or is the market already baking in future growth?

Most Popular Narrative: 23.2% Undervalued

With Surgery Partners closing at $14.44 against a narrative fair value of $18.80, the most followed view sees meaningful upside baked into its cash flow potential, supported by a detailed earnings and margin roadmap.

Disciplined execution on M&A and portfolio optimization, including accretive acquisitions and potential asset sales or health system partnerships, should enhance margin expansion, accelerate deleveraging, and improve free cash flow conversion, supporting improvements in net margins and long-term earnings power.

Curious what turns current losses into future profits in this story? The narrative leans heavily on rising margins, steadier revenue growth, and a richer earnings base.

Result: Fair Value of $18.80 (UNDERVALUED)

However, this depends on risks around higher interest costs and slower acquisitions, which could pressure margins and make that 70x future P/E look demanding.

Next Steps

Mixed signals so far, right? With at least one risk on the radar and at least one reward in focus, now is a good time to review both sides using 3 key rewards and 1 important warning sign

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.