Surgery Partners (SGRY) stock rose 47.62% on Oct. 26, 2026 to $23.25, and is up 46.23% over two sessions from the Oct. 22 close. Motley Fool reported the move followed news that HealthSpan will acquire the company in a large deal. A buyout usually pins a stock near the price the buyer pays, so the move matters more for the deal terms than for the company's quarterly results.
Key facts
- Oct. 26, 2026: SGRY traded at $23.25 on the latest quote (Oct. 26, 2026), up 47.62% on the day. The 52-week range is $11.41 to $23.44.
- Two sessions: the stock is up 46.23% from the Oct. 22, 2026 close.
- Cause as reported: Motley Fool's Oct. 26 market recap tied the jump to the HealthSpan acquisition. Two investor law firms also published notices the same day: Ademi LLP, about the buyout price, and SBS Law, which announced a fraud investigation of Surgery Partners.
- Latest quarter (Q2 FY2026, ended June 30, 2026): revenue was $848.9M, 2.7% higher than a year earlier. Net income was a loss of $15.0M.
- Next earnings date: Nov. 9, 2026. Analysts expect EPS of 0.1176 and revenue of $848.3M.
- Market cap: $3.04B.
What happened
Surgery Partners runs surgical facilities and ambulatory surgery centers in the US. On Monday, Oct. 26, 2026, its shares jumped 47.62%. Motley Fool's market recap that day said the stock rose on a large acquisition by HealthSpan. We could not find the full deal terms in the material we reviewed, so we do not repeat any price here.
Two law firms published notices the same day, and they are about different things. Ademi LLP said it is investigating whether the buyout fairly values Surgery Partners. That is the only notice we reviewed that concerns the buyout price. Separately, SBS Law, in a Business Wire release headlined "SGRY Investors Have Opportunity to Join Surgery Partners, Inc. Fraud Investigation with SBS Law," announced a fraud investigation of Surgery Partners. The release is SBS Law's own announcement. An investigation is not a finding, and we did not see details of what it covers. Neither notice is a court ruling.
The two-session gain of 46.23% is almost the same as the one-day gain. Nearly all the move therefore came on the news day. The shares now trade at $23.25, just under the 52-week high of $23.44. That is the pattern investors usually see when a stock tracks a buyout price.
Why the business alone didn't drive it
The most recent results do not explain a move this size. In Q2 FY2026 (ended June 30, 2026), reported Aug. 10, 2026, the company beat estimates:
- EPS was 0.1 against an estimate of 0.05794.
- Revenue was $848.9M against an estimate of $830.0M.
Five-quarter trend
| Quarter | Revenue | Gross margin | Operating margin | Net income | Free cash flow | |---|---|---|---|---|---| | Q2 FY2025 | $826.2M | 23.7% | 13.5% | $-2.5M | $57.9M | | Q3 FY2025 | $821.5M | 23.8% | 12.9% | $-22.7M | $63.8M | | Q4 FY2025 | $885.0M | 24.0% | 12.5% | $-15.0M | $90.6M | | Q1 FY2026 | $810.9M | 15.0% | 10.2% | $-35.9M | $-4.3M | | Q2 FY2026 | $848.9M | 22.4% | 12.0% | $-15.0M | $37.5M |
Operating margin (the share of revenue left after running costs) slipped over most of this stretch. It hit its low in Q1 FY2026 and recovered in Q2 FY2026, though it remains below a year earlier. Free cash flow (cash from operations minus capital spending) turned negative in Q1 FY2026 and was positive again in Q2 FY2026. It is still lower than a year earlier. The company paid no dividends and made no buybacks in any of these quarters.
Where the revenue came from
In Q2 FY2026, government revenue was $380.6M, up from $348.5M a year earlier. Private insurance revenue was $401.4M, down from $416.2M. Self-pay revenue was $23.5M, up from $21.7M. The company's revenue is therefore shifting toward government payers and away from private insurers.
Why it matters for investors
Valuation at the current price. The trailing-12-month ratios use the current $3.04B market cap at $23.25, which is after the jump. The price-to-sales ratio is 0.90 and EV/EBITDA is 7.22. EV/EBITDA compares the whole business value, debt included, to operating earnings. The P/E is -33.70, which is negative because of the net losses. Net margin is -2.6%.
Peers.
| Company | Market cap | P/E | Net margin | |---|---|---|---| | Surgery Partners (SGRY) | $3.04B | -33.70 | -2.6% | | Ardent Health (ARDT) | $1.72B | 22.15 | 1.2% | | Community Health Systems (CYH) | $414.6M | -1.30 | -1.3% | | HCA Healthcare (HCA) | $100.73B | 15.53 | 8.8% | | Nutex Health (NUTX) | $1.43B | 7.97 | 21.2% |
Surgery Partners has the weakest net margin in this group. It and Community Health Systems are the two with a negative P/E.
Analysts. Of 22 ratings, 14 are buy and 8 are hold, with none rated sell. The consensus is "Buy." The consensus price target averages $21.33, with a median of $23.50 and a range of $17.00 to $23.50. The stock now trades above the average target and close to the top of the range. RBC Capital maintained its Outperform rating on Sept. 30, 2026.
Insiders. Among the 30 most recent insider filings, those dated in the last 90 days show 2 open-market purchases and no sales. Older filings in that window may be missing.
Our MoonshotScore. Stock Expert AI's MoonshotScore V2 for SGRY is 33.6, rated Weak. The sector-relative pillars are:
- Momentum: 94 (the recent jump)
- Valuation: 75
- Quality: 67
- Growth: 63
- Safety: 10 (the weakest pillar)
Risks and what could go wrong
- Heavy debt. As of June 30, 2026, total debt was $4.02B against cash and short-term investments of $216.7M, for net debt of $3.80B. Shareholders' equity was $1.67B, and debt-to-equity is 2.40.
- Weak financial-strength scores. The Piotroski score is 4 out of 9, and the Altman Z-score is 1.03. Both point to a stretched balance sheet.
- Deal risk. Takeovers can face shareholder challenges, regulatory review or changed terms. The Ademi LLP notice shows that at least one law firm is questioning whether the price is fair. If a deal fails, the stock could give back part of this gain. We do not predict whether that will happen.
- Fraud investigation announced by SBS Law. SBS Law announced a fraud investigation of Surgery Partners and invited investors to join it. This is the law firm's own announcement. It is an investigation, not a finding, and we have not seen evidence of wrongdoing. Such a probe could still bring legal costs, distraction or scrutiny of the company.
- Model value. FMP's discounted cash flow model, an estimate of what future cash flows are worth today, gives $7.97 per share. That is far below the current price. Models like this are sensitive to their assumptions, so treat the figure as one rough reference point.
- Margins and mix. Operating margin is below a year earlier, and revenue is shifting toward government payers.
What to watch next
- Deal documents. Look for filings with the SEC that describe the price, financing, conditions and expected closing date.
- Shareholder reaction. Watch whether the law-firm investigations lead to any formal action.
- Nov. 9, 2026 earnings. Analysts expect EPS of 0.1176 and revenue of $848.3M for the quarter. The company may say less on its outlook while a deal is pending.
- Analyst actions. Ratings and targets may be updated or dropped now that a buyout is on the table.
- Cash flow and debt. Check whether free cash flow keeps recovering from the Q1 FY2026 low.
Frequently asked questions
Q: Why did Surgery Partners stock go up on Oct. 26, 2026?
According to Motley Fool's Oct. 26 market recap, shares rose after news that HealthSpan will acquire the company in a large deal. The stock traded at $23.25 on the latest quote (Oct. 26, 2026), up 47.62% on the day.
Q: Is Surgery Partners stock still below the buyout level?
The material we reviewed does not give a verified deal price, so we cannot say. What the data shows is that the stock is at $23.25, close to its 52-week high of $23.44. The average analyst target is $21.33, and the highest target is $23.50. Check the company's filings for the terms.
Q: What are the law-firm notices about SGRY?
There are two. Ademi LLP said it is investigating whether the buyout fairly values Surgery Partners. SBS Law announced a fraud investigation of Surgery Partners in a Business Wire release and invited investors to join it. Both are announcements by law firms, not court rulings. The SBS Law investigation is not a finding of fraud, and the Ademi LLP notice does not mean the deal is unfair. This article is not investment advice.
This is educational content, not investment advice. Past performance does not guarantee future results.