SGRY Should I Buy
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Surgery Partners Inc (SGRY) is not a good buy for a beginner investor with a long-term horizon at this time. The stock is experiencing significant downward pressure due to weak financial performance, negative sentiment from analysts, and ongoing challenges in its business operations. Additionally, technical indicators and options data do not suggest a strong recovery in the near term. It is advisable to wait for clearer signs of improvement before considering an investment.
The technical indicators for SGRY are bearish. The MACD is negatively expanding, the RSI is at 27.127 (indicating oversold conditions but no clear reversal signal), and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5). The stock is trading below key support levels, with the next support at 12.957 and resistance at 14.351. Overall, the trend suggests further downside risk.
Hedge funds have significantly increased their buying activity, with a 682.35% increase over the last quarter. This indicates some institutional confidence in the stock's long-term potential.
The company reported weak Q4 financial results, including a significant drop in net income (-86.18% YoY) and gross margin (-25.50% YoY). Analysts have broadly lowered price targets, citing disappointing EBITDA and revenue guidance. Additionally, the stock is under investigation for potential investor claims, and it has hit a five-year low. Negative sentiment is further fueled by deteriorating payer mix and anesthesia-related cost pressures.
In Q4 2025, Surgery Partners reported revenue growth of 2.38% YoY to $885 million. However, net income dropped significantly to -$15 million (-86.18% YoY), and EPS fell to -$0.12 (-86.05% YoY). Gross margin also declined sharply to 17.21% (-25.50% YoY), reflecting operational challenges and cost pressures.
Analysts have lowered their price targets significantly, with the most recent targets ranging from $14 to $24. While most analysts maintain a Buy or Outperform rating, their notes highlight concerns over weak financial performance, negative insurance mix shifts, and cautious guidance for 2026. The sentiment is mixed but leans negative in the short term.
