On Tuesday, Citi affirmed its Buy rating on Surgery Partners (NASDAQ:SGRY) shares, with a steady price target of $43.00. The financial institution is anticipating the company's fourth-quarter results, set to be released before the market opens on February 26, to align with current EBITDA estimates.
Surgery Partners, traded on NASDAQ under the ticker NASDAQ:SGRY, is expected to disclose its fourth-quarter earnings soon. Citi's projections for the company's fourth-quarter EBITDA are at $141.3 million, closely matching the consensus estimate of $141.4 million. Looking ahead, the estimates for the full year of 2024 suggest an EBITDA of $488.9 million by Citi, slightly below the consensus of $494.7 million, but both are near the company's initial guidance of over $495 million.
The positive sentiment towards Surgery Partners has been supported by the company's reaffirmed guidance for 2023 and an encouraging initial outlook for 2024. This optimism persists despite potential challenges indicated by the current elevated utilization environment and other factors that could affect the company's performance.
Citi's analysis indicates no significant surprises are expected in the upcoming quarterly report. The forecast takes into account various factors such as competitive comparisons and the increased contribution of EBITDA from minority investments.
In conclusion, Citi views Surgery Partners as a company with a structurally advantageous position in the market. The firm believes Surgery Partners has a sustainable path to achieve mid-teens EBITDA growth and reduce leverage over time, which should enhance the stock's value for shareholders.
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