Surgery Partners (SGRY) Is Down 10.9% After $425M Debt Raise And Baylor Partnership - What's Changed

• In December 2025, Surgery Partners, Inc. completed a US$425,000,000 offering of 7.250% senior unsecured notes due 2032 under Rule 144A and Regulation S, supported by fixed coupons and guarantees.
• Around the same time, the company entered a partnership with Baylor Scott & White Health to jointly own and operate a 16-bed surgical hospital in Bryan, Texas, broadening its role in high-acuity outpatient care across the College Station region.
• Next, we’ll examine how the Baylor Scott & White partnership and added debt financing reshape Surgery Partners’ investment narrative and growth outlook.

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Surgery Partners Investment Narrative Recap

To own Surgery Partners, you need to believe in the continued shift of complex surgeries into outpatient settings and the company’s ability to turn growing revenue into sustainable profits. The new US$425,000,000 senior notes strengthen liquidity but also add to interest costs, which ties directly into the key near term risk around rising debt service and its drag on already negative earnings and cash flow.

The Baylor Scott & White partnership around The Physicians Centre Hospital is most relevant here, because it expands Surgery Partners’ presence in higher acuity procedures that underpin its growth thesis. As investors weigh added leverage from the bond issue, this type of hospital collaboration helps frame whether new capital is being matched with assets that can support volume growth, case mix improvement and eventual margin progress.

Yet despite the appeal of expanding outpatient surgery volumes, investors should be aware that higher interest costs could...

Read the full narrative on Surgery Partners (it's free!)

Surgery Partners' narrative projects $4.3 billion revenue and $164.3 million earnings by 2028.

Uncover how Surgery Partners' forecasts yield a $25.73 fair value, a 66% upside to its current price.

Exploring Other Perspectives

Two fair value estimates from the Simply Wall St Community sit between about US$25.73 and US$66.87, reflecting very different views on upside. Against that backdrop, the added 7.250 percent senior notes and higher interest burden give you a clear reason to compare these opinions and stress test your own expectations for Surgery Partners’ path to profitability.

Explore 2 other fair value estimates on Surgery Partners - why the stock might be worth over 4x more than the current price!

Build Your Own Surgery Partners Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Surgery Partners research is our analysis highlighting 3 key rewards that could impact your investment decision.
• Our free Surgery Partners research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Surgery Partners' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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