Company Overview - Select Medical Holdings Corporation is one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the United States based on the number of facilities [4] - As of December 31, 2024, Select Medical operated 104 critical illness recovery hospitals in 29 states, 35 rehabilitation hospitals in 14 states, and 1,914 outpatient rehabilitation clinics in 39 states and the District of Columbia [4] - The company has operations in 41 states and the District of Columbia [4] Financial Results Announcement - Select Medical will release its financial results for the fourth quarter and year ended December 31, 2024, on Thursday, February 20, 2025, after the market closes [1] - A conference call regarding the fourth quarter and full year results, as well as the business outlook, will be hosted on Friday, February 21, 2025, at 9:00 am ET [2] - The conference call will be available as a live webcast and can be accessed through the company's website [2]

Core Viewpoint - Select Medical Holdings Corporation (SEM) has experienced a significant decline in stock performance, dropping 48.2% over the past six months, which is substantially worse than the industry average decline of 1.9% [1][2] Financial Performance - SEM's stock is currently down 14.9% from its 52-week high of $22.08 and is trading below its 50-day moving average, indicating potential downward momentum [2] - The company's profitability has been negatively impacted by rising costs, which increased by 11.5%, 5.8%, and 2.5% in 2021, 2022, and 2023, respectively, with an additional 5.6% rise in the first nine months of 2024 [5] - Overall costs are projected to increase by more than 5% year-over-year for the full year, putting pressure on profit margins [5] Growth Strategy - SEM is pursuing growth through acquisitions to enhance volumes, but its return on invested capital stands at 6.2%, below the industry average of 10.4%, indicating less effective capital utilization [6] - The company faces significant leverage, with a net debt-to-capital ratio of 55.2%, compared to the industry average of 20.6% [7] - As of September 30, 2024, SEM reported $3.1 billion in long-term debt and only $191.5 million in cash and cash equivalents [7] Strategic Initiatives - SEM completed the spin-off of Concentra in November 2024, which aims to streamline operations and focus on core business areas such as critical illness recovery hospitals and rehabilitation clinics [9] Valuation Metrics - The stock is currently trading at 9.57X forward 12-month earnings, below its five-year median of 12.90X and the industry average of 14.34X, suggesting it may be undervalued [10] - Peers like Centene and Cigna are valued at 8.88X and 9.62X forward 12-month earnings, respectively [12] Earnings Outlook - The Zacks Consensus Estimate for SEM's current-quarter adjusted earnings is 15 cents per share, reflecting a 58.3% year-over-year decline, with further declines of 46.8% expected for the next quarter [13] Conclusion - Rising costs and significant leverage are straining SEM's financial health, and despite strategic moves like the Concentra spin-off, downward earnings revisions and underperformance compared to peers indicate ongoing struggles [14]

Core Viewpoint - Select Medical Holdings Corporation has successfully completed a private offering of $550 million in senior notes, which will be used to refinance existing debt and cover related expenses [1][2]. Group 1: Offering Details - Select Medical Corporation, a subsidiary of Select Medical Holdings, issued $550 million in 6.250% senior notes due 2032 [1]. - The notes are senior unsecured obligations and are guaranteed by certain existing and future domestic subsidiaries of Select [1]. Group 2: Use of Proceeds - The net proceeds from the offering, along with funds from a new incremental term loan and cash on hand, will be utilized to fully repay existing term loans under the senior secured credit agreement [2]. - The proceeds will also be used to redeem all outstanding 6.250% senior notes due 2026 and to cover associated fees and expenses [2]. Group 3: Regulatory Information - The notes and related guarantees have not been registered under the Securities Act of 1933 and are offered only to qualified institutional buyers and certain non-U.S. persons [3]. - The offering is conducted in compliance with Rule 144A and Regulation S under the Securities Act [3].

Core Viewpoint - Select Medical (SEM) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [3][5]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [3]. Company Performance and Outlook - The upgrade for Select Medical indicates an improvement in the company's underlying business, which is expected to positively influence its stock price [4]. - For the fiscal year ending December 2024, Select Medical is projected to earn $2.16 per share, reflecting an 8.5% increase from the previous year, with a 4.2% rise in the Zacks Consensus Estimate over the past three months [7]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [6]. - Only the top 20% of Zacks-covered stocks receive a 'Strong Buy' or 'Buy' rating, indicating superior earnings estimate revisions and potential for market-beating returns [8][9]. Conclusion - The upgrade of Select Medical to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a favorable outlook for the stock in the near term [10].

A downtrend has been apparent in Select Medical (SEM) lately with too much selling pressure. The stock has declined 38.1% over the past four weeks. However, given the fact that it is now in oversold territory and Wall Street analysts are majorly in agreement about the company's ability to report better earnings than they predicted earlier, the stock could be due for a turnaround.How to Determine if a Stock is OversoldWe use Relative Strength Index (RSI), one of the most commonly used technical indicators, f ...

Hospital operator Select Medical Holdings Corporation (SEM) recently completed the spin-off of Concentra Group Holdings Parent, Inc. (CON) by distributing its 81.7% ownership stake in the company to its shareholders. Per the previously announced distribution plan, Select Medical distributed 104,093,503 shares of Concentra’s common stock.This was done through a pro-rata stock distribution, where shareholders of SEM received 0.806971 shares of Concentra common stock for each share of SEM they held as of the r ...

MECHANICSBURG, Pa., Nov. 25, 2024 /PRNewswire/ -- Select Medical Holdings Corporation ("Select Medical," "we," "us," or "our") (NYSE: SEM) today announced that we have completed our previously announced distribution (the "Distribution") of 104,093,503 shares of common stock of Concentra Group Holdings Parent, Inc. ("Concentra") (NYSE: CON) owned by Select Medical Corporation ("SMC"), a wholly owned subsidiary of Select Medical, representing approximately 81.7% of the outstanding shares of Concentra's common ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being un ...

MECHANICSBURG, Pa., Nov. 19, 2024 /PRNewswire/ -- Select Medical Holdings Corporation ("Select Medical," "we," "us," or "our") (NYSE: SEM) today announced the distribution ratio for the previously announced special stock distribution (the "Distribution") to its stockholders of its equity interest in Concentra Group Holdings Parent, Inc. ("Concentra") (NYSE: CON). Based on the shares of Select Medical's common stock outstanding as of November 18, 2024, the record date (the "Record Date") for the Distribution ...

MECHANICSBURG, Pa.  , Nov. 18, 2024 /PRNewswire/ -- Select Medical Holdings Corporation ("Holdings") (NYSE: SEM), today announced that Select Medical Corporation, a wholly-owned subsidiary of Holdings ("Select"), has priced a private offering (the "Offering") of $550.0 million in aggregate principal amount of its 6.250% senior notes due 2032 (the "notes"). The Offering is expected to close on December 3, 2024, subject to the satisfaction of customary closing conditions. The notes will be senior unsecured ob ...