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Select Medical (SEM) to Post Q4 Earnings: What to Expect
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Select Medical Holdings Corporation (SEM - Free Report) is set to report its fourth-quarter 2022 results on Feb 23, after the closing bell.
In the last reported quarter, the company reported adjusted earnings per share of 21 cents, which lagged the Zacks Consensus Estimate by 52.3% due to higher costs and expenses, along with weak performance in the Critical Illness Recovery Hospital unit. However, the negatives were partially offset by higher patient days and improved performance in the Rehabilitation Hospital unit.
The Zacks Consensus Estimate for fourth-quarter earnings per share of 33 cents has witnessed no movement in the past week. The estimate indicates a 10.8% decrease from the year-ago quarter’s reported earnings of 37 cents per share. Our estimate for the fourth-quarter bottom line is also pegged at 33 cents per share.
Both the Zacks Consensus Estimate and our estimate for revenues are pegged at $1.6 billion, suggesting a rise of 3.8% from the year-ago quarter’s reported figure.
Select Medical’s earnings beat estimates in two of the trailing four quarters and missed on the other two occasions, the average negative surprise being 3.2%. This is depicted in the graph below.
Select Medical Holdings Corporation Price and EPS Surprise
Select Medical’s fourth-quarter results are expected to witness improved figures in Rehabilitation Hospital aided by the growing number of hospitals, the average length of stay, patient days and occupancy rate. We expect revenues from the segment to have witnessed almost 10% growth from a year ago.
Our estimate for the Outpatient Rehabilitation unit’s number of visits indicates 2.5% year-over-year growth. Its patient services revenues are expected to have increased 4.8% year over year in the fourth quarter.
Furthermore, we expect growing visits in the Concentra segment to have aided its revenue growth. The factors stated above are likely to have positioned Select Medical for year-over-year growth in revenues. However, its rising operating costs are expected to have been spoilsports.
Lower occupancy rates and admissions are expected to have affected the Critical Illness Recovery Hospital unit in the fourth quarter. Our estimate for operating income from the segment indicates a decline of more than 30%. This is expected to have curtailed the company’s margins, making an earnings beat uncertain.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Select Medical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. The Most Accurate Estimate is currently pegged at 33 cents per share, in line with the Zacks Consensus Estimate.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Select Medical currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
While an earnings beat looks uncertain for Select Medical, here are some companies in the broader medical space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:
The Zacks Consensus Estimate for Vir Biotechnology’s bottom line for the to-be-reported quarter has witnessed one upward estimate revision in the past 30 days against none in the opposite direction. VIR beat earnings estimates in three of the past four quarters and missed once.
SI-BONE, Inc. (SIBN - Free Report) has an Earnings ESP of +5.51% and a Zacks Rank #3.
The Zacks Consensus Estimate for SI-BONE’s bottom line for the to-be-reported quarter indicates a 2.3% improvement from a year ago. The consensus mark for revenues suggests a 26% year-over-year increase.
Merus N.V. (MRUS - Free Report) has an Earnings ESP of +28.91% and is a Zacks #3 Ranked player.
The Zacks Consensus Estimate for Merus’ bottom line for the to-be-reported quarter has remained stable over the past week. MRUS beat earnings estimates in all the past four quarters, with an average of 42%.
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Select Medical (SEM) to Post Q4 Earnings: What to Expect
Select Medical Holdings Corporation (SEM - Free Report) is set to report its fourth-quarter 2022 results on Feb 23, after the closing bell.
In the last reported quarter, the company reported adjusted earnings per share of 21 cents, which lagged the Zacks Consensus Estimate by 52.3% due to higher costs and expenses, along with weak performance in the Critical Illness Recovery Hospital unit. However, the negatives were partially offset by higher patient days and improved performance in the Rehabilitation Hospital unit.
Let’s see how things have shaped up prior to the fourth-quarter earnings announcement.
The Trend in Estimate Revision
The Zacks Consensus Estimate for fourth-quarter earnings per share of 33 cents has witnessed no movement in the past week. The estimate indicates a 10.8% decrease from the year-ago quarter’s reported earnings of 37 cents per share. Our estimate for the fourth-quarter bottom line is also pegged at 33 cents per share.
Both the Zacks Consensus Estimate and our estimate for revenues are pegged at $1.6 billion, suggesting a rise of 3.8% from the year-ago quarter’s reported figure.
Select Medical’s earnings beat estimates in two of the trailing four quarters and missed on the other two occasions, the average negative surprise being 3.2%. This is depicted in the graph below.
Select Medical Holdings Corporation Price and EPS Surprise
Select Medical Holdings Corporation price-eps-surprise | Select Medical Holdings Corporation Quote
Factors to Note
Select Medical’s fourth-quarter results are expected to witness improved figures in Rehabilitation Hospital aided by the growing number of hospitals, the average length of stay, patient days and occupancy rate. We expect revenues from the segment to have witnessed almost 10% growth from a year ago.
Our estimate for the Outpatient Rehabilitation unit’s number of visits indicates 2.5% year-over-year growth. Its patient services revenues are expected to have increased 4.8% year over year in the fourth quarter.
Furthermore, we expect growing visits in the Concentra segment to have aided its revenue growth. The factors stated above are likely to have positioned Select Medical for year-over-year growth in revenues. However, its rising operating costs are expected to have been spoilsports.
Lower occupancy rates and admissions are expected to have affected the Critical Illness Recovery Hospital unit in the fourth quarter. Our estimate for operating income from the segment indicates a decline of more than 30%. This is expected to have curtailed the company’s margins, making an earnings beat uncertain.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Select Medical this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. The Most Accurate Estimate is currently pegged at 33 cents per share, in line with the Zacks Consensus Estimate.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Select Medical currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
While an earnings beat looks uncertain for Select Medical, here are some companies in the broader medical space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:
Vir Biotechnology, Inc. (VIR - Free Report) has an Earnings ESP of +338.10% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vir Biotechnology’s bottom line for the to-be-reported quarter has witnessed one upward estimate revision in the past 30 days against none in the opposite direction. VIR beat earnings estimates in three of the past four quarters and missed once.
SI-BONE, Inc. (SIBN - Free Report) has an Earnings ESP of +5.51% and a Zacks Rank #3.
The Zacks Consensus Estimate for SI-BONE’s bottom line for the to-be-reported quarter indicates a 2.3% improvement from a year ago. The consensus mark for revenues suggests a 26% year-over-year increase.
Merus N.V. (MRUS - Free Report) has an Earnings ESP of +28.91% and is a Zacks #3 Ranked player.
The Zacks Consensus Estimate for Merus’ bottom line for the to-be-reported quarter has remained stable over the past week. MRUS beat earnings estimates in all the past four quarters, with an average of 42%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.