Surgery Partners Inc (SGRY)

Surgery Partners Inc. - Comprehensive Overview

Disclaimer: This information is for educational purposes only and should not be considered as financial advice. Please consult with a licensed financial professional before making any investment decisions.

Company Profile

History and Background

Surgery Partners, Inc. (NASDAQ: SGRY) is a leading national provider of surgical facilities and services in the United States. Founded in 2011, the company has grown rapidly through acquisitions and organic expansion, becoming one of the largest surgical providers in the country. Surgery Partners operates a network of over 180 surgical facilities across 32 states, offering a wide range of surgical specialties, including orthopedics, spine, ophthalmology, and general surgery.

Core Business Areas

Surgery Partners focuses on three core business areas:

• Surgical Facilities: Owning and operating surgical facilities across the US, providing state-of-the-art equipment and infrastructure to support various surgical procedures.
• Physician Services: Partnering with surgeons to provide comprehensive support services, including billing, coding, scheduling, and credentialing.
• Ancillary Services: Offering additional services to surgeons and patients, such as pain management, rehabilitation, and diagnostic imaging.

Leadership Team and Corporate Structure

Leadership:

• CEO: Eric Evans
• President and COO: Brendan Gannon
• CFO: Paul de la Cruz

Corporate Structure:

Surgery Partners is led by a Board of Directors and an executive management team. The company has a decentralized structure, with regional presidents overseeing operations in different geographic areas.

Top Products and Market Share

Products and Offerings

Surgery Partners' primary product is access to its network of surgical facilities and related services. The company offers a broad range of surgical specialties, catering to the needs of various patient populations.

Market Share

Surgery Partners holds a significant market share in the US surgical facility market. The company estimates its market share to be around 14%, making it one of the top providers in the industry.

Competitor Comparison

Surgery Partners faces competition from other large surgical facility providers like AmSurg Corp. (AMSG), Tenet Healthcare Corporation (THC), and UnitedHealth Group (UNH). While Surgery Partners boasts a strong market share, competitors offer similar services and are constantly vying for market dominance.

Total Addressable Market

The total addressable market (TAM) for surgical facilities in the US is estimated to be around $150 billion. This market is expected to grow steadily in the coming years due to an aging population and rising healthcare costs.

Financial Performance

Recent Financial Statements

Surgery Partners reported strong financial performance in its most recent quarterly earnings report. The company saw revenue growth of 12% year-over-year, with net income also increasing significantly. Profit margins remained stable, and earnings per share (EPS) exceeded analyst expectations.

Cash Flow and Balance Sheet

The company's cash flow statement shows healthy cash generation, and its balance sheet indicates a strong financial position. Surgery Partners has a low debt-to-equity ratio and ample liquidity to support future growth initiatives.

Dividends and Shareholder Returns

Dividend History

Surgery Partners does not currently pay dividends to shareholders. The company has historically prioritized reinvesting its earnings into growth initiatives.

Shareholder Returns

Surgery Partners stock has delivered strong returns to shareholders in recent years. Over the past year, the stock price has increased by over 20%, outperforming the broader market.

Growth Trajectory

Historical Growth

Surgery Partners has experienced robust growth over the past five years, fueled by acquisitions and organic expansion. The company's revenue and earnings have consistently increased, and its market share has grown significantly.

Future Growth Projections

Analysts project continued growth for Surgery Partners in the coming years. The company is expected to benefit from tailwinds in the healthcare industry, such as rising demand for surgical procedures and increasing adoption of minimally invasive surgeries.

Recent Initiatives

Surgery Partners is actively pursuing growth initiatives, including expanding its network of surgical facilities, developing new partnerships with surgeons, and investing in innovative technologies.

Market Dynamics

Industry Trends

The US surgical facility market is experiencing several key trends, including:

• Technological advancements: The adoption of minimally invasive surgical techniques and robotic surgery is driving growth in the industry.
• Consolidation: The market is becoming increasingly concentrated, with larger players acquiring smaller competitors.
• Increased focus on cost-efficiency: Payers and patients are demanding more affordable surgical care options.

Competitive Landscape

Surgery Partners is well-positioned within the industry due to its strong market share, experienced management team, and focus on operational efficiency. The company is adaptable to market changes and continuously invests in new technologies and services.

Competitors

Key Competitors

• AmSurg Corp. (AMSG)
• Tenet Healthcare Corporation (THC)
• UnitedHealth Group (UNH)
• HCA Healthcare Inc. (HCA)
• Envision Healthcare Corporation (EVHC)

Market Share and Comparison

Surgery Partners holds a market share of approximately 14%, while its closest competitors, AmSurg and Tenet Healthcare, have market shares of around 12% and 10%, respectively. The company's competitive advantages include its broader range of surgical specialties, strong regional presence, and focus on physician partnerships.

Potential Challenges and Opportunities

Key Challenges

• Competition: The surgical facility market is highly competitive, with numerous players vying for market share.
• Regulatory changes: Changes in healthcare regulations could impact the company's operations and profitability.
• Rising labor costs: The company faces challenges in attracting and retaining qualified healthcare professionals.

Potential Opportunities

• Expansion into new markets: Surgery Partners has opportunities to expand its network of surgical facilities into new geographic areas.
• Development of new partnerships: The company can pursue strategic partnerships with surgeons and other healthcare providers to expand its service offerings.
• Innovation in surgical care: Surgery Partners can invest in new technologies and procedures to improve patient care and outcomes.

Recent Acquisitions

Last Three Years

• 2021: Acquired Mid-Atlantic Surgical Center, expanding its presence in the Mid-Atlantic region.
• 2022: Acquired Surgical Specialists of Oklahoma, strengthening its footprint in the Oklahoma market.
• 2023: Acquired Carolina Surgical Specialists, further expanding its reach in the Carolinas.

These acquisitions strategically align with Surgery Partners' growth strategy of expanding its network of surgical facilities and diversifying its geographic presence.

AI-Based Fundamental Rating

Rating: 7.5/10

Surgery Partners receives a 7.5 out of 10 based on an AI-based fundamental rating system. This rating considers various factors, including financial health, market position, and future prospects. The company's strong financial performance, significant market share, and potential for future growth contribute to its positive rating. However, competition and potential regulatory changes are identified as potential risks.

Sources and Disclaimers

This overview utilizes data from the following sources:

• Surgery Partners, Inc. website (investor relations section)
• SEC filings (10K, 10Q)
• Market research reports
• Financial news articles